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**1AC**..................................................................3HEALTHCARE 1AC - INH....................................4HEALTHCARE 1AC – ECON ADV......................5HEALTHCARE 1AC – ECON ADV......................6HEALTHCARE 1AC – ECON ADV......................7HEALTHCARE 1AC – ECON ADV......................8HEALTHCARE 1AC – ECON ADV......................9HEALTHCARE 1AC – ECON ADV....................10HEALTHCARE 1AC – ECON ADV....................11HEALTHCARE 1AC – ECON ADV....................12HEALTHCARE 1AC – COMP ADV...................13HEALTHCARE 1AC – COMP ADV...................14HEALTHCARE 1AC – COMP ADV...................15HEALTHCARE 1AC – COMP ADV...................16HEALTHCARE 1AC – COMP ADV...................17HEALTHCARE 1AC - PLAN..............................18HEALTHCARE 1AC - SOLVENCY...................19HEALTHCARE 1AC - SOLVENCY...................21HEALTHCARE 1AC - SOLVENCY...................22HEALTHCARE 1AC - SOLVENCY...................23HEALTHCARE 1AC - SOLVENCY...................24

**INHERENCY**...............................................25Obama HC Inev.....................................................26Obama HC Inev.....................................................27Obama HC Inev.....................................................28Obama HC Inev.....................................................29Obama HC Fails - Cost..........................................30Obama HC Fails - Concessions.............................31Obama HC Fails – Industry Profit.........................32Obama HC Not Single Payer.................................33Universal Reform Fails - Congress........................34Universal Reform Fails – Health Politics..............35

**ECON – STATES**........................................362AC AT: Stimulus Solves State Deficits...............372AC AT: Kills Econ..............................................382AC AT: US Not Key to Global Econ..................39Medicaid Costs High Now.....................................40Medicaid Drains State Budgets.............................41Obama HC Drains State Budgets..........................42Obama HC Drains State Budgets..........................43Obama HC Drains State Budgets..........................44

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Obama HC Drains State Budgets..........................45Obama HC Drains State Budgets..........................45Obama HC Drains State Budgets..........................46Obama HC Drains State Budgets..........................47State Deficits Now – No HC.................................49State Deficits Now – No HC.................................50State Deficits Now – No Education.......................51State Deficits Now – No Education.......................52State Deficits Now – Job Loss...............................53States Deficit Now—Tradeoffs.............................54State Deficits Now—Tradeoffs.............................55State Deficits Now –Tradeoffs..............................56State Deficits Tank Econ.......................................57State Deficits Tank Econ.......................................58State Deficits Tank Econ.......................................59More Stimulus Needed - Unemployment..............60More Stimulus Needed - Insufficient....................61More Stimulus Needed - Statistics........................62More Stimulus Needed – States Key.....................63More Stimulus Needed – States Key.....................64More Stimulus Needed – States Key.....................65More Stimulus Needed – States Key.....................66A2: ARRA Stimulus Solves Medicaid Deficits.....67Trickle Up Stimulus Needed.................................68Fed Action Key......................................................69Federalize Medicaid Solves State Budgets............70Medicaid Reform Solves State Budgets................71Medicaid Reform Solves State Budgets................72Single Payer Solves State Deficits.........................73Kentucky – Medicaid Chopping Block.................74Louisiana – Medicaid Deficit................................75

**ECON – FEDERAL DEF**............................76Consumer Confidence Low Now..........................77**ECON IMPACTS**..........................................78Lashout ! Scenario.................................................79China ! Scenario (1/2)............................................80China ! Scenario (2/2)............................................81Terror ! Scenario....................................................82

**COMPETITIVENESS**................................83Competitiveness K2 Heg.......................................84Econ K2 Heg..........................................................85Econ Decline Killing Heg Now.............................86Econ K2 Obama Agenda.......................................87HC Reform Key to Econ........................................88Deflation Coming..................................................89

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Deflation Coming..................................................90Increases Competitiveness.....................................91Competitiveness K2 Growth..................................92

**MEDICAID REFORM**...............................93Federalize Medicaid Good.....................................94Medicaid Reform Needed......................................95Medicaid Reform Needed......................................96Medicaid Reform Needed......................................97Medicaid Reform Needed......................................98Medicaid Bad.........................................................99Reform Must Start With Medicaid......................100Medicare Spill Up................................................101Slow Phase In Key – Medicare & Australia Prove102Medicare Subsume Medicaid?.............................103Medicaid Expansion Key.....................................104

**SOLVENCY**...............................................105Low-Income Uninsured Coverage Needed.........106Solvency – Medicare Based System Solves........107Squo Reform Fails – Need Single-Payer.............108Squo HC Fails......................................................109Single Payer Solves - Waste................................110Single Payer Solves – Waste & Patchwork.........111Single Payer Solves – Bureaucracy.....................112Single Payer Solves – Medical Consensus..........113Single Payer Solves – Dem Accountability.........114Single Payer Solves – Fair Wages.......................115Single Payer Solves – Drug Costs.......................116Single Payer Solves - Physicians.........................117Single Payer Solves –Efficient............................118Single Payer Solves –Efficient............................119Single Payer Solves –Empirics............................120Uninsured Impoverished......................................121Uninsured are Poor..............................................122A2: High Cost......................................................123A2: No Innovation/Wait......................................124A2: Bureaucracy..................................................125A2: Utopian?........................................................126A2: Scale Up Not Possible..................................127A2: National Health Program Bad.......................128A2: Canada Empirically Fails..............................129A2: Rationing.......................................................130A2: Socialized Medicine......................................131A2: Socialized Medicine......................................132A2: MSA/HSA.....................................................133A2: Free Market More Efficient..........................134

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A2: O’Neill..........................................................135A2: Employer-Based HC.....................................136A2: Managed Competition..................................137A2: Physician Backlash.......................................138

**Add-ons**.......................................................139Small Business Add-on........................................140Small Business Add-on Ext.................................141Equal Protection...................................................142

**2AC**..............................................................143Plan Pop...............................................................144Plan Unpop..........................................................145Losers Win?.........................................................1462AC Healthcare Politics (1/3)..............................1472AC Healthcare Politics (2/3)..............................1482AC Healthcare Politics (3/3)..............................1492AC CTBT Politics (1/3).....................................1502AC CTBT Politics (2/3).....................................1512AC CTBT Politics (3/3).....................................1522AC Econ DA (1/3).............................................1532AC Econ DA (2/3).............................................1542AC Econ DA (3/3).............................................1552AC Military DA (1/2)........................................1562AC Military DA (2/2)........................................1572AC Immigration DA (1/4).................................1582AC Immigration DA (2/4).................................1592AC Immigration DA (3/4).................................1602AC Immigration DA (4/4).................................1612AC States CP (1/2).............................................1622AC States CP (2/2).............................................163A2: States CP.......................................................164A2: States CP.......................................................165A2: States CP.......................................................166A2: States CP.......................................................167A2: Pincer CP/Medicaid Expansion CP..............168

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**1AC**

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HEALTHCARE 1AC - INH

Observation One: The Inevitable

Some semblance of national health care reform will pass – even if it’s not through before the recess Obama’s political clout guarantees it will pass by the end of the year.Woodhead, news correspondent. 7/23/09.Laura. “Health Reform Still Urgent Despite No Bill Before Recess Say Senate Dems.” Talk Radio News Service. http://talkradionews.com/2009/07/health-reform-still-urgent-despite-no-bill-before-recess-say-senate-dems/ [Mardjuki]

Although the Senate may not vote on health care until after the August recess, passing reform is still an urgent priority said top Democrats on Thursday. Speaking at a press conference, Sen. Chris Dodd (D-Conn.) said while it’s unlikely that a bill would be up for debate on the Senate floor before September, the Senate has no excuse to take its time on finding solutions for our nation’s health care problems. “That does not excuse our committees from doing everything we can during these weeks before the August break, and during the August break to try and meld our ideas and bills together in order so that when we return in September we will be prepared.” Dodd said. “We do not have the luxury of not dealing with this.” Dodd said that the President’s leadership on health care reform has been strong. [President Obama] is committed, as committed as any president I have ever seen to a single issue. He has said over and over again that he will expand whatever capital in order to achieve the goal of national health care reform in the nation” Dodd said. Sen. Thomas Carper (D-Del.) explained that the health care bill is moving slowly through committee because of the multitude of problems being addressed. “This is probably the hardest legislative lift that any of us will make whether we are here for four years or forty,” said Carper. “If it takes a couple of extra days, a couple of extra weeks or even a couple of extra months its worth the wait.” Health and Human Services Secretary Kathleen Sebelius joined the Senators, and stressed that health care reform must help not only Americans who are uninsured, but also those who do already have insurance. “The current cost curve cannot be sustained by business owners or by families,” Sebelius said. “Those who have health insurance are a day, a week, a month away from losing it.” Dodd said that there would be a bill on the President’s desk by the end of the year. “We have a mandate from the American people to address this issue,” he said. “I still believe very strongly that we are going to achieve that goal.” “I’m willing to wait, spend the time, do it right, but we need to get it done.”

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Observation 2: Advantages

Advantage 1: Economy -

A) Instant State Stimulus

Medicaid spending already drains state budgets – state legislators are doing everything they can to stay above water.Sack, New York Times senior journalist, two-time Pulitzer Prize winner. 1/21/09.Kevin. “Growing Need for Medicaid Strains States.” New York Times. 2009. http://www.nytimes.com/2009/01/22/us/22medicaid.html [Mardjuki]

Eligibility for the income-based program can vary widely by state. But at any one time last year, Medicaid was providing coverage to an average of 50 million people, or about one of every six in the United States . The cost of the program — $333 billion in 2007 — is shared by state and federal governments, with Washington roughly matching the spending approved by the states. The federal government currently picks up about 57 percent of the tab, eating up 7 percent of the federal budget, and the program is one of the largest drains on every state’s budget . As in any economic downturn, the countercyclical program now faces a grim fiscal paradox: by definition, demand for Medicaid coverage is highest precisely when states are least able to afford it because of shrinking tax revenues. Lawmakers returning to state capitals across the country are preparing to negotiate significant reductions in Medicaid spending by freezing or reducing reimbursements to hospitals and physicians, by eliminating coverage options like dental and vision benefits, and by narrowing eligibility for the program.

Increased state expenses inevitable – every health care bill debated forces states to pay for massive Medicaid expansion.Kevin Sack and Robert Pear, 7-19-2009 (two-time Pulitzer Prize winner and correspondent for the New York Times), “Governors Fear Medicaid Costs in Healthcare” http://www.nytimes.com/2009/07/20/health/policy/20health.html?hp

Although many governors said significant change in how the nation handles health care was needed, they said their deep-seated fiscal troubles made it a terrible time to shift costs to the states . With the recession draining states of tax revenues even as their Medicaid rolls are surging, the National Governors Association projects that states will face aggregate deficits of $200 billion over the next three years. Each of several health care bills coursing through Congress relies on a large increase in eligibility for Medicaid, the state and federal insurance program for the poor, as one means of moving toward universal coverage. Because the states and the federal government share the cost, any increase in eligibility levels, benefits or payments to doctors would impose new burdens on the states unless Washington absorbs them. In at least one of several bills circulating in Congress, the states would eventually pick up a share of the new costs, and the governors fear they cannot count on provisions in other bills that they will not bear costs. It was unclear whether the governors would draft a statement expressing their dismay, at least partly because half of them did not attend. Many, including the group’s chairman, Gov. Edward G. Rendell of Pennsylvania, a Democrat, stayed home to deal with budget crises. Some of the group’s most notable names — Arnold Schwarzenegger of California, Sarah Palin of Alaska, Tim Pawlenty of Minnesota and Bobby Jindal of Louisiana — were not here. But the sentiment among those who were could not have been more consistent, regardless of political party. The governors said in interviews and public sessions that the bills being drafted in Congress would not do enough to curb the growth in health spending. And they said they were convinced that a major expansion of Medicaid would leave them with heavy costs. They are already anticipating large gaps in Medicaid financing after 2010, when stimulus money dries up. And they pointed out that Medicaid already suffered from low payment rates to health care providers, discouraging some doctors and hospitals from accepting beneficiaries. If Medicaid is expanded, states will almost surely have to increase payments to doctors to encourage more of them to participate. Gov. Phil Bredesen of Tennessee, a Democrat, said he feared Congress was about to

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bestow “the mother of all unfunded mandates.” “Medicaid is a poor vehicle for expanding coverage,” added Mr. Bredesen, a former health care executive. “It’s a 45-year-old system originally designed for poor women and their children. It’s not health care reform to dump more money into Medicaid.” Mr. Bredesen was far from alone in his concern. “As a governor, my concern is that if we try to cost-shift to the states we’re not going to be in a position to pick up the tab,” said Gov. Christine Gregoire of Washington.

And a second round of stimulus is needed – federal money to ease state deficits is crucial to stem further recession.Mattoon, senior economist and economic advisor @ Chicago Federal Reserve. August 2009.Richard. “Should the Federal Government Bail Out the States? Lessons from Past Recessions.” Chicago Federal Reserve Bank Essay Number 265. http://www.chicagofed.org/publications/fedletter/cflaugust2009_265.pdf [Mardjuki]

Like the economy in general , individual state economies are struggling in this recession. State governments face significant constraints in raising additional revenues. Most states are required to balance their budgets regardless of the economic environment. This article considers the role of the federal government in helping the states to manage their finances. State government budget woes have been much in the news . Recently, California projected a $21 billion deficit after failing to get voter approval for a series of budget balancing fiscal measures.1 In January of this year, five prominent Democratic governors suggested that the federal government should commit $1 trillion in aid to the states over the next two years.2 The rationale for such financial support is that states (which are generally prohibited from running deficits) need the money to maintain key programs, such as Medicaid, unemployment insurance, and work force training, for which demand rises during a recession . Also, this aid might help states avoid enacting spending cuts or tax increases that could deepen or prolong the economic downturn.

Federal assistance crucial to stem negative pro-cyclical economic state action.Lav, Gold award for contribution to state fiscal policy, state budget and tax expert, McNichol, state budget and tax senior fellow. 6/29/09.Iris and Elizabeth. “State Budget Troubles Worsen.” Center on Budget and Policy Priorities. http://www.cbpp.org/cms/index.cfm?fa=view&id=711 [Mardjuki]

The current situation has been made more difficult because many states never fully recovered from the fiscal crisis of the early part of the decade. This heightens the potential impact on public services of the shortfalls states now are projecting. State spending fell sharply relative to the economy during the 2001 recession, and for all states combined it still remains below the fiscal year 2001 level. In 18 states, general fund spending for fiscal year 2008 — six years into the economic recovery — remained below pre-recession levels as a share of the gross domestic product. In a number of states the reductions made during the downturn in education, higher education, health coverage, and child care remain in effect. These important public services were suffering even as states turned to budget cuts to close the new budget gaps. Spending as a share of the economy declined in fiscal year 2008 and is projected to decline further in 2009 and again in 2010. One way states can avoid making deep reductions in services during a recession is to build up rainy day funds and other reserves. At the end of fiscal year 2006, state reserves — general fund balances and rainy day funds — totaled 11.5 percent of annual state spending. Reserves can be particularly important to help states adjust in the early months of a fiscal crisis, but generally are not sufficient to avert the need for substantial budget cuts or tax increases. In this recession, states have already drawn down much of their available reserves; the available reserves in states with deficits are likely to be depleted in the near future. Federal assistance Crucial. Federal assistance can lessen the extent to which states need to take pro-cyclical actions that can further harm the economy. The American Recovery and Reinvestment Act recognizes this fact and includes substantial assistance for states. The amount in ARRA to help states maintain current activities is about $135 billion to $140 billion — or less than half of projected state shortfalls. Most of this money is in the form of increased Medicaid funding and a “Fiscal Stabilization Fund.” This money has reduced to a degree the depth of state spending cuts and moderated state tax and fee increases. There are also other streams of funding in the economic recovery act flowing through states to local governments or individuals, but this will not address state budget shortfalls.

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Medicaid reform is the only way to solve the state budget crisis.Olsen, senior reporter. 6/20/09.Dean. “Medicaid reform tied to state budget crisis.” State Journal-Register. http://www.sj-r.com/homepage/x488806173/Medicaid-reform-tied-to-state-budget-crisis [Mardjuki]

Regardless of how much money would be saved this year or next, reform of Illinois’ Medicaid program — or at least firm plans to make changes in the system — appears to be a key component of any resolution to the state budget crisis . Republicans in the Democrat-controlled Illinois Senate and House have all but required that long-term Medicaid reform be part of any budget discussions. Republican votes may be crucial to reduce the impact of the state’s $9 billion deficit through a potential income tax increase. According to the most optimistic estimates, Medicaid reforms could save a total of $983 million over the next two years, and more in future years. Republicans say that without changes, the rising cost of Medicaid will take up more and more state resources and “crowd out” other state services while further delaying payments to Medicaid providers. “It is the 700-pound gorilla quickly turning into the 900-pound gorilla,” state Sen. Dale Righter, R-Mattoon, said last week. “We want to make as much positive change as possible.” Many Republicans also believe there is too much waste in the system and that some people don’t deserve state-provided health care that was made available to more children and parents under former Gov. Rod Blagojevich. But there is disagreement — and outright fear — about the potential ramifications for patients, hospitals and doctors when it comes to changes in state health programs that cover 2.5 million Illinoisans and cost $12 billion a year in state and federal funds. Howard Peters, senior vice president of the Naperville-based Illinois Hospital Association, said Republican fervor for Medicaid reforms appears to be fueled by “the dilemma of raising taxes.” “People are almost desperately looking for some kind of ‘silver bullet’ that can get us out of this thing that can be painless,” he said. “I’m not sure there is a clear-enough concept of the consequences of these proposals.” Medicaid spending has grown an average of almost 8 percent per year between 2003 and 2008, more than twice the rate of inflation, according to a recent report by Gov. Pat Quinn’s Taxpayer Action Board. The report, which is available online at http://tinyurl.com/taxpayerboard, says that if costs continue to grow at that rate Medicaid spending will reach $22 billion in 2019 and could represent 50 percent of the state budget. “ It should be obvious to everyone that if you’re concerned about anything in the budget, you need to be concerned about Medicaid,” Righter said. He is one of four Republican lawmakers who began meeting privately Friday with four of their Democratic counterparts in the General Assembly and a representative of Quinn to discuss ideas for Medicaid reform. Consensus wasn’t reached on any issues after the two-hour meeting in Chicago, but the group will meet again Tuesday or Wednesday in Springfield, said Michael Gelder, Quinn’s chief health-policy adviser.

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B) Federal Deficits

Obama’s healthcare proposal fails to curb entitlement spending – increased taxes needed to fund.Pear, senior writer, Herszenhorn, reporter. 7/17/09Robert and David. “Democrats Grow Wary as Health Bill Advances.” New York Times. http://www.nytimes.com/2009/07/18/health/policy/18health.html?pagewanted=print [Mardjuki]

Three of the five Congressional committees working on legislation to reinvent the nation’s health care system delivered bills this week along the lines proposed by President Obama. But instead of celebrating their success, many Democrats were apprehensive, nervous and defensive. Even as Democratic leaders and the White House insisted that the nation was closer than ever to landmark changes in the health care system, they faced basic questions about whether some of their proposals might do more harm than good. And while senior Democrats vowed to press ahead to meet Mr. Obama’s deadline of having both chambers pass bills before the summer recess, some in their ranks, nervous about the prospect of raising taxes or proceeding without any Republican support, were pleading to slow down. Democrats had three reasons for concern. The director of the Congressional Budget Office warned Thursday that the legislative proposals so far would not slow the growth of health spending , a crucial goal for Mr. Obama as he also tries to extend insurance to more than 45 million Americans who lack it. Second, even with House committees working in marathon sessions this week, it was clear that Democrats could not meet their goal of passing bills before the summer recess without barreling over the concerns of Republicans and ending any hope that such a major issue could be addressed in a bipartisan manner. Third, a growing minority of Democrats have begun to express reservations about the size , scope and cost of the legislation , the expanded role of the federal government and the need for a raft of new taxes to pay for it all. The comments suggest that party leaders may not yet have the votes to pass the legislation. Mr. Obama tried Friday to shift the political narrative away from the grim forecasts of the Congressional Budget Office. He said he and Congress had made “unprecedented progress” on health care, with even the American Medical Association endorsing the House bill this week. He acknowledged a treacherous path ahead, saying, “The last few miles of any race are the hardest to run,” but insisted, “Now is not the time to slow down.” And he vowed: “We are going to get this done. We will reform health care. It will happen this year. I’m absolutely convinced of that.” On Capitol Hill, the picture is more complex. Representative Jared Polis, a freshman Democrat from Colorado who voted against the bill approved Friday in the Education and Labor Committee, said he worried that the new taxes “could cost jobs in a recession .” To help finance coverage of the uninsured, the House bill would impose a surtax on high-income people and a payroll tax — as much as 8 percent of wages — on employers who do not provide health insurance to workers. Mr. Polis said these taxes, combined with the scheduled increase in tax rates resulting from the expiration of Bush-era tax cuts, would have a perverse effect. “Some successful family-owned businesses would be taxed at higher rates than multinational corporations,” he said. In a letter to the House speaker, Nancy Pelosi, Mr. Polis and 20 other freshman Democrats said they were “extremely concerned that the proposed method of paying for health care reform will negatively impact small businesses, the backbone of the American economy.”

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Pressure by Senate leaders and Obama to pass healthcare quickly ensures that healthcare reform will be ineffective and costly.Pear, senior writer, Herszenhorn, reporter. 7/17/09Robert and David. “Democrats Grow Wary as Health Bill Advances.” New York Times. http://www.nytimes.com/2009/07/18/health/policy/18health.html?pagewanted=print [Mardjuki]

And in the latest sign of lawmakers’ chafing at Mr. Obama’s ambitious timetable, a bipartisan group of six senators, including two members of the Finance Committee, sent a letter to Senate leaders pleading with them to allow more time. “While we are committed to providing relief for American families as quickly as possible,” they wrote, “we believe taking additional time to achieve a bipartisan result is critical for legislation that affects 17 percent of our economy and every individual in the United States.” The group included three senators, Ben Nelson, Democrat of Nebraska; and Olympia J. Snowe and Susan Collins, Republicans of Maine, who met with Mr. Obama at the White House this week and urged him not to rush the bill. “The legislative process right now is going in the wrong direction,” said Senator Joseph I. Lieberman , the Connecticut independent, who also signed the letter. “I think it’s extremely doable to get this done before the end of the year. But just to try to get it passed in the Senate before we leave for the August recess seems just about impossible. It’s just too big a bill.” The House education committee approved the bill, 26 to 22, on Friday morning, after an all-night session. Three Democrats crossed party lines and voted no. The vote came eight hours after the House Ways and Means Committee approved a nearly identical bill, 23 to 18, with 3 Democrats voting no. On Wednesday, the Senate health committee approved a generally similar bill on a party-line vote, 13 to 10. The House and Senate bills would require insurers to take all applicants and vastly expand coverage, with federal subsidies for millions of people. But the director of the Congressional Budget Office, Douglas W. Elmendorf, testified on Thursday that doing so would come at a steep cost and that the proposals would not curb the rise in health spending by the federal government, which he called “unsustainable.” A budget office analysis released Friday said the House bill would “result in a net increase in the federal budget deficit of $239 billion” over 10 years, partly because of an increase in Medicare spending to avert sharp cuts in payments to doctors. House Democrats who voted no cited various concerns. “ We are not doing enough to reform the health care delivery system, to change the incentives so reimbursement will be based on the value, rather than the volume, of services,” Representative Ron Kind of Wisconsin said.

Only a single-payer healthcare system is able to solve for perverse incentives and bureaucratic waste.Angell, MD, Editor of New England Journal of Medicine, Senior Lecturer @ Harvard Medical School, 2009.Marcia, Quentin Young, American Public Health Association, Joel Alpert, American Academy of Pediatrics, Ron Anderson, CEO Parkland Health System, Peter Beilenson, Commissioner of Baltimore City Health, Christine Cassell, President of American College of Physicians. “Proposal of the Physicians’ Working Group for single-Payer National Health Insurance.” Physicians For A National Health Program. http://www.pnhp.org/single_payer_resources/proposal_of_the_physicians_working_group_for_singlepayer_national_health_insurance.php [Mardjuki]

We endorse a fundamental change in America’s health care - the creation of a comprehensive National Health Insurance (NHI) Program. Such a program - which in essence would be an expanded and improved version of Medicare - would cover every American for all necessary medical care. Most hospitals and clinics would remain privately owned and operated, receiving a budget from the NHI to cover all operating costs. Investor-owned facilities would be converted to not-for-profit status, and their former owners compensated for past investments. Physicians could continue to practice on a fee-for-service basis, or receive salaries from group practices, hospitals or clinics. A National Health Insurance Program would save at least $150 billion annually by eliminating the high overhead and profits of the private, investor-owned insurance industry and reducing spending for marketing and other satellite services. Doctors and hospitals would be freed from the concomitant burdens and expenses of paperwork created by having to deal with multiple insurers with different rules - often rules designed to avoid payment. During the transition to an NHI, the savings on administration and profits would fully offset the costs of expanded and improved coverage. NHI would make it possible to set and enforce overall spending limits for the health care system, slowing cost growth over the long run. A National Health Insurance Program is the only affordable option for universal, comprehensive coverage. Under the current system, expanding access to health care

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inevitably means increasing costs, a nd reducing costs inevitably means limiting access. But an NHI could both expand access and reduce costs. It would squeeze out bureaucratic waste and eliminate the perverse incentives that threaten the quality of care and the ethical foundations of medicine.

Federal entitlement reform is needed to signal long term fiscal solvency and prevent spiraling sell-offs of US debt.Boston Globe, 2-23-09

Budget analysts are worried that a continuing economic crisis will make it impossible to raise sufficient funds from foreign markets to finance the nation's debt. In the last four years, about three-quarters of US debt was purchased by foreign interests, most prominently by China. If other nations lose confidence that the United States will pay its debts, however, some economists fear an international financial crisis could escalate and turn into a worldwide depression . In any case, it is widely expected that debt purchasers will soon demand higher interest rates, which would translate into higher costs for US taxpayers. Obama is being urged by some analysts to start moving toward a balanced budget as soon as possible to send a signal to the world that deficit spending will abate. Yet some analysts are offering Obama conflicting advice, warning him not to repeat what they regard as the mistake of President Franklin Roosevelt, who launched the New Deal but eventually heeded calls to curtail deficit spending, only to see a new recession batter his presidency. A key player in the summit will be Senator Judd Gregg, the New Hampshire Republican who backed out of his commitment to be Obama's commerce secretary and then voted against the stimulus bill. Despite the embarrassment caused by Gregg's about-face, the White House believes that he could be one of its most important allies in the overhaul of Social Security, Medicare, and tax policy. That is because Gregg is the co-sponsor of the measure that would create a bipartisan commission to put together far-reaching recommendations for an up-or-down vote by Congress. In an interview, Gregg said that under such a procedure, the measures could be passed within a year, as long as most of the benefit cuts and tax increases were not slated to take effect until well after the recession is over. "We need an up-or-down vote on a package that will be unquestionably bipartisan and fair," Gregg said, a reference to criticism that Obama's stimulus bill was too partisan. Asked about his hopes for the summit, he said, "It can either be very nice public relations or move the ball down the road on what is an impending fiscal tsunami." Some budget specialists are skeptical. Robert Reischauer, former head of the Congressional Budget Office, said Obama should have seized the opportunity to pair the stimulus bill with the overhaul of Social Security, Medicare, and the tax code. "When you are shoveling out the goodies, you have a greater probability of getting people to sign on to some fiscal diet," said Reischauer, who has been invited to the summit. He said he is worried that nothing will happen on the most difficult issues until political leaders "have a gun at our heads. The system tends to respond only in the face of unavoidable crisis." Analysts across the political spectrum agree that the current path is unsustainable. Unless there is a major budgetary change, federal spending will go from being about 20 percent of the nation's economy to 42 percent in 2050, according to the Concord Coalition. The major reason is that entitlement programs for older Americans are running short of funds. Social Security is slated to pay out more money than it receives by 2017. Obama suggested during his campaign that he might support changing the level of income at which Social Security taxes are calculated. Another frequently mentioned option is raising the retirement age. But any measure will be even more controversial than usual because so many Americans have seen their private retirement plans pummeled by the stock market collapse. Medicare, the government-run healthcare program for older Americans, is already running a deficit, which is expected to increase quickly as baby boomers retire. That is why many analysts are urging Obama to link changes in Medicare with an overhaul of the health system.

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Continued economic decline culminates in WWIIIMead, 9 – Henry A. Kissinger Senior Fellow in U.S. Foreign Policy at the Council on Foreign Relations(Walter Russell, “Only Makes You Stronger,” The New Republic, 2/4/09,http://www.tnr.com/politics/story.html?id=571cbbb9-2887-4d81-8542-92e83915f5f8&p=2)

The damage to China's position is more subtle. The crisis has not--yet--led to the nightmare scenario that China-watchers fear: a recession or slowdown producing the kind of social unrest that could challenge the government. That may still come to pass--the recent economic news from China has been consistently worse than most experts predicted--but, even if the worst case is avoided, the financial crisis has nevertheless had significant effects. For one thing, it has reminded China that its growth remains dependent on the health of the U.S. economy. For another, it has shown that China's modernization is likely to be long, dangerous, and complex rather than fast and sweet, as some assumed. In the lead-up to last summer's Beijing Olympics, talk of a Chinese bid to challenge America's global position reached fever pitch, and the inexorable rise of China is one reason why so many commentators are fretting about the "post-American era." But suggestions that China could grow at, say, 10 percent annually for the next 30 years were already looking premature before the economic downturn. (In late 2007, the World Bank slashed its estimate of China's GDP by 40 percent, citing inaccuracies in the methods used to calculate purchasing power parity.) And the financial crisis makes it certain that China's growth is likely to be much slower during some of those years. Already exports are falling, unemployment is rising, and the Shanghai stock market is down about 60 percent. At the same time, Beijing will have to devote more resources and more attention to stabilizing Chinese society, building a national health care system, providing a social security net, and caring for an aging population, which, thanks to the one-child policy, will need massive help from the government to support itself in old age. Doing so will leave China fewer resources for military build-ups and foreign adventures. As the crisis has forcefully reminded Americans, creating and regulating a functional and flexible financial system is difficult. Every other country in the world has experienced significant financial crises while building such systems, and China is unlikely to be an exception. All this means that China's rise looks increasingly like a gradual process. A deceleration in China's long-term growth rate would postpone indefinitely the date when China could emerge as a peer competitor to the United States. The present global distribution of power could be changing slowly, if at all. The greatest danger both to U.S.-China relations and to American power itself is probably not that China will rise too far, too fast; it is that the current crisis might end China's growth miracle. In the worst-case scenario, the turmoil in the international economy will plunge China into a major economic downturn. The Chinese financial system will implode as loans to both state and private enterprises go bad. Millions or even tens of millions of Chinese will be unemployed in a country without an effective social safety net. The collapse of asset bubbles in the stock and property markets will wipe out the savings of a generation of the Chinese middle class. The political consequences could include dangerous unrest--and a bitter climate of anti-foreign feeling that blames others for China's woes. (Think of Weimar Germany , when both Nazi and communist politicians blamed the West for Germany's economic travails.) Worse, instability could lead to a vicious cycle, as nervous investors moved their money out of the country, further slowing growth and, in turn, fomenting ever-greater bitterness. Thanks to a generation of rapid economic growth, China has so far been able to manage the stresses and conflicts of modernization and change; nobody knows what will happen if the growth stops. India's future is also a question. Support for global integration is a fairly recent development in India, and many serious Indians remain skeptical of it. While India's 60-year-old democratic system has resisted many shocks, a deep economic recession in a country where mass poverty and even hunger are still major concerns could undermine political order, long-term growth, and India's attitude toward the United States and global economic integration. The violent Naxalite insurrection plaguing a significant swath of the country could get worse; religious extremism among both Hindus and Muslims could further polarize Indian politics; and India's economic miracle could be nipped in the bud. If current market turmoil seriously damaged the performance and prospects of India and China, the current crisis could join the Great Depression in the list of economic events that changed history , even if the recessions in the West are relatively short and mild. The United States should stand ready to assist Chinese and Indian financial authorities on an emergency basis--and work very hard to help both countries escape or at least weather any economic downturn. It may test the political will of the Obama administration, but the United States must avoid a protectionist response to the economic slowdown. U.S. moves to limit market access for Chinese and Indian producers could poison relations for years. For billions of people in nuclear-armed countries to emerge from this crisis believing either that the United States was indifferent to their well-being or that it had profited from their distress could damage U.S. foreign policy far more severely than any mistake made by George W. Bush. It's not just the great powers whose trajectories have been affected by the crash. Lesser powers like Saudi Arabia and Iran also face new constraints. The crisis has strengthened the U.S. position in the Middle East as falling oil prices reduce Iranian influence and increase the dependence of the oil sheikdoms on U.S. protection. Success in Iraq--however late, however undeserved, however

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limited— had already improved the Obama administration's prospects for addressing regional crises. Now, the collapse in oil prices has put the Iranian regime on the defensive. The annual inflation rate rose above 29 percent last September, up from about 17 percent in 2007, according to Iran's Bank Markazi. Economists forecast that Iran's real GDP growth will drop markedly in the coming months as stagnating oil revenues and the continued global economic downturn force the government to rein in its expansionary fiscal policy. All this has weakened Ahmadinejad at home and Iran abroad. Iranian officials must balance the relative merits of support for allies like Hamas, Hezbollah, and Syria against domestic needs, while international sanctions and other diplomatic sticks have been made more painful and Western carrots (like trade opportunities) have become more attractive. Meanwhile, Saudi Arabia and other oil states have become more dependent on the United States for protection against Iran, and they have fewer resources to fund religious extremism as they use diminished oil revenues to support basic domestic spending and development goals. None of this makes the Middle East an easy target for U.S. diplomacy, but thanks in part to the economic crisis, the incoming administration has the chance to try some new ideas and to enter negotiations with Iran (and Syria) from a position of enhanced strength. Every crisis is different, but there seem to be reasons why, over time, financial crises on balance reinforce rather than undermine the world position of the leading capitalist countries. Since capitalism first emerged in early modern Europe, the ability to exploit the advantages of rapid economic development has been a key factor in international competition. Countries that can encourage--or at least allow and sustain--the change, dislocation, upheaval, and pain that capitalism often involves, while providing their tumultuous market societies with appropriate regulatory and legal frameworks, grow swiftly. They produce cutting-edge technologies that translate into military and economic power. They are able to invest in education, making their workforces ever more productive. They typically develop liberal political institutions and cultural norms that value, or at least tolerate, dissent and that allow people of different political and religious viewpoints to collaborate on a vast social project of modernization--and to maintain political stability in the face of accelerating social and economic change. The vast productive capacity of leading capitalist powers gives them the ability to project influence around the world and, to some degree, to remake the world to suit their own interests and preferences. This is what the United Kingdom and the United States have done in past centuries, and what other capitalist powers like France, Germany, and Japan have done to a lesser extent. In these countries, the social forces that support the idea of a competitive market economy within an appropriately liberal legal and political framework are relatively strong. But, in many other countries where capitalism rubs people the wrong way, this is not the case. On either side of the Atlantic, for example, the Latin world is often drawn to anti-capitalist movements and rulers on both the right and the left. Russia, too, has never really taken to capitalism and liberal society--whether during the time of the czars, the commissars, or the post-cold war leaders who so signally failed to build a stable, open system of liberal democratic capitalism even as many former Warsaw Pact nations were making rapid transitions. Partly as a result of these internal cultural pressures, and partly because, in much of the world, capitalism has appeared as an unwelcome interloper, imposed by foreign forces and shaped to fit foreign rather than domestic interests and preferences, many countries are only half-heartedly capitalist. When crisis strikes, they are quick to decide that capitalism is a failure and look for alternatives. So far, such half-hearted experiments not only have failed to work; they have left the societies that have tried them in a progressively worse position, farther behind the front-runners as time goes by. Argentina has lost ground to Chile; Russian development has fallen farther behind that of the Baltic states and Central Europe. Frequently, the crisis has weakened the power of the merchants, industrialists, financiers, and professionals who want to develop a liberal capitalist society integrated into the world. Crisis can also strengthen the hand of religious extremists, populist radicals, or authoritarian traditionalists who are determined to resist liberal capitalist society for a variety of reasons. Meanwhile, the companies and banks based in these societies are often less established and more vulnerable to the consequences of a financial crisis than more established firms in wealthier societies. As a result, developing countries and countries where capitalism has relatively recent and shallow roots tend to suffer greater economic and political damage when crisis strikes--as, inevitably, it does. And, consequently, financial crises often reinforce rather than challenge the global distribution of power and wealth. This may be happening yet again. None of which means that we can just sit back and enjoy the recession. History may suggest that financial crises actually help capitalist great powers maintain their leads--but it has other, less reassuring messages as well. If financial crises have been a normal part of life during the 300-year rise of the liberal capitalist system under the Anglophone powers, so has war. The wars of the League of Augsburg and the Spanish Succession; the Seven Years War; the American Revolution; the Napoleonic Wars; the two World Wars; the cold war: The list of wars is almost as long as the list of financial crises. Bad economic times can breed wars. Europe was a pretty peaceful place in 1928, but the Depression poisoned German public opinion and helped bring Adolf Hitler to power. If the current crisis turns into a depression, what rough beasts might start slouching toward Moscow, Karachi, Beijing, or New Delhi to be born? The United States may not, yet, decline, but, if we can't get the world economy back on track, we may still have to fight.

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Advantage 2: Competitiveness

Skyrocketing health care costs deter companies from hiring in the U.S. – Obama’s health care proposals do nothing to slow rampant job loss.Teslik, economic expert and assistant editor @ CFR, Johnson, staff writer. 3/4/09.Lee, Tori. “Health Care Costs and U.S. Competitiveness.” Council on Foreign Relations. http://www.cfr.org/publication/13325/ [Mardjuki]

These ballooning dollar figures place a heavy burden on companies doing business in the United States and can put them at a substantial competitive disadvantage in the international marketplace. For large multinational corporations, footing healthcare costs presents an enormous expense. General Motors, for instance, covers more than 1.1 million employees and former employees, and the company says it spent roughly $5.6 billion on healthcare expenses in 2006. GM says healthcare costs add between $1,500 and $2,000 to the sticker price of every automobile it makes. Health benefits for unionized auto workers became a central issue derailing the 2008 congressional push to provide a financial bailout to GM and its ailing Detroit rival, Chrysler. It is difficult to quantify the precise effect high healthcare costs have had so far on the overall U.S. job market. Health care is one of several factors--entrenched union contracts are another--that make doing business in the United States expensive, and it's difficult to parse the effects of each factor. Moreover, economists disagree on the number of U.S. jobs that have been lost to offshoring--the transfer of business operations across national boundaries to friendlier operating environments. The Princeton economist Alan S. Blinder, in a 2006 Foreign Affairs article, says that judging by data compiled from "fragmentary studies," it is apparent that "under a million service-sector jobs in the United States have been lost to offshoring to date." Blinder goes on to predict that somewhere between 28 million and 42 million U.S. jobs are "susceptible" to offshoring in a future where technology allows the more efficient transfer of jobs . Many other economists, however, have shied away from making such estimates, and some have criticized Blinder's approach. It is clear, however, that healthcare expenses affect every level of U.S. industry. For large corporations they mean the massive "legacy costs" associated with insuring retired employees. For small business owners they can be even more devastating. "In many places, you have small businesses that simply cannot afford to offer coverage," Sarbanes says. Often, he says, healthcare expenses make it impossible for small business owners to hire candidates they would otherwise desire . Elsewhere in the world, healthcare systems are much less reliant on private sector support--and much less expensive. For example, the U.S. system costs 83 percent more per capita than the Canadian system, where public funds collected through taxes pay for up to 70 percent of healthcare coverage . A number of East Asian systems also enjoy high quality of care for a much lower cost. An article in Cambridge University's Journal of Social Policy looks at what it calls the "remarkable" performance of healthcare systems in Hong Kong, Malaysia, and Singapore, where the authors argue the legacy of British colonialism has encouraged a strong state role in the healthcare system. Taiwan's system is commonly singled out as a model for cost-effectiveness . An article in Health Affairs examines Taiwan's National Health Insurance (or NHI) system, implemented in 1995, which provides comprehensive universal health coverage to Taiwan's roughly 23 million citizens. The authors conclude that savings from the NHI system largely offset the incremental cost of covering the previously uninsured. Taiwanese are assessed around $20 a month for full health coverage. In contrast, Americans pay roughly $500 per month, according to data in a report by McKinsey. Not surprisingly, U.S. job drift comes primarily from industries where jobs are most "tradeable," as Blinder puts it. Services that can be delivered electronically--information technology, for instance, but also a wide and expanding array of other service-sector jobs--will be easier to shift across national boundaries in the future. This doesn't mean American jobs will necessarily be lost--jobs can also be brought onshore--but it does mean industry will have to adapt. By and large, companies do not argue against the employer-based insurance model. Rather, they contend that a wasteful public-private system is pushing costs much higher than they should be. Jeffrey Rideout, a medical doctor and the head of the Internet Business Solutions Group at Cisco Systems' Healthcare Practice, says the amount businesses pay for employee insurance is just one element of their total healthcare costs. Rideout says businesses incur a "triple tax." First, they pay for insurance programs through health benefits. Second, he says, businesses indirectly subsidize Medicare and Medicaid, the federally supported programs for primarily poor and elderly Americans. Businesses pay higher insurance premiums to make up for the fact that Medicare and Medicaid reimbursements often do not match the total costs hospitals incur treating these patients, a "hidden tax" confronted in a health care proposal (PDF) laid out by California's Governor Arnold Schwarzenegger. Third, Rideout says, businesses also subsidize the strain on the system wrought by the cost of treating America's uninsured, again through higher insurance premiums. "In many places, you have small businesses that simply cannot afford to offer coverage." -- Rep. John Sarbanes Obama does not propose to alter the employer-based system and move to a single-payer, government-run system. Instead, he wants to allow people and small businesses, who currently have trouble affording health insurance, to buy into a government-sponsored insurance pool similar to the one for insuring U.S. federal employees . The proposal also includes a small business tax credit for those that provide coverage to their employees to help with the costs. Obama's proposal would mandate coverage for children but not adults. Obama's plan may be opposed, however, by lawmakers who are against expanding government's role in health care or placing more requirements on the industry.

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And a single-payer healthcare system radically decreases employers’ health care costs, enhancing competitiveness.Angell, MD, Editor of New England Journal of Medicine, Senior Lecturer @ Harvard Medical School, 2009.Marcia, Quentin Young, American Public Health Association, Joel Alpert, American Academy of Pediatrics, Ron Anderson, CEO Parkland Health System, Peter Beilenson, Commissioner of Baltimore City Health, Christine Cassell, President of American College of Physicians. “Proposal of the Physicians’ Working Group for single-Payer National Health Insurance.” Physicians For A National Health Program. http://www.pnhp.org/single_payer_resources/proposal_of_the_physicians_working_group_for_singlepayer_national_health_insurance.php [Mardjuki]

The insurance/HMO industry would have virtually no role in health care financing, since public insurance administration is more efficient, and single source payment is the key to both equal access and cost control. Indeed, most of the extra funds needed to finance the expansion of care would come from eliminating insurance company overhead and profits, and abolishing the billing apparatus necessary to apportion costs among the various plans. The Effect on Corporate America: Firms now providing generous employee health benefits would probably realize savings because their tax contribution to NHI would likely be less than current health insurance costs. Since most firms competing on international markets would save money, the competitiveness of U.S. products would be enhanced . Tax-based NHI funding might, however increase costs for companies not now providing health benefits.

Economic competitiveness is a prerequisite to heg.Khalilzad, US Ambassador to the UN. 1995. Zalmay, “Losing the Moment? The United States and the World After the Cold War.” Washington Quarterly, Spring Vol. 18, No. 2, LexisNexis. [Mardjuki]

The United States is unlikely to preserve its military and technological dominance if the U.S. economy declines seriously. In such an environment, the domestic economic and political base for global leadership would diminish and the United States would probably incrementally withdraw from the world, become inward-looking, and abandon more and more of its external interests. As the United States weakened, others would try to fill the Vacuum. To sustain and improve its economic strength, the United States must maintain its technological lead in the economic realm. Its success will depend on the choices it makes. In the past, developments such as the agricultural and industrial revolutions produced fundamental changes positively affecting the relative position of those who were able to take advantage of them and negatively affecting those who did not. Some argue that the world may be at the beginning of another such transformation, which will shift the sources of wealth and the relative position of classes and nations. If the United States fails to recognize the change and adapt its institutions, its relative position will necessarily worsen.

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US hegemony key to check multiple scenarios for nuclear war.Kagan 7 Senior Associate @ the Carnegie Endowment for International Peace(End of Dreams, Return of History, Policy Review, Hoover Institution, http://www.hoover.org/publications/policyreview/8552512.html)

Finally, there is the United States itself. As a matter of national policy stretching back across numerous administrations, Democratic and Republican, liberal and conservative, Americans have insisted on preserving regional predominance in East Asia; the Middle East; the Western Hemisphere; until recently, Europe; and now, increasingly, Central Asia. This was its goal after the Second World War, and since the end of the Cold War, beginning with the first Bush administration and continuing through the Clinton years, the United States did not retract but expanded its influence eastward across Europe and into the Middle East, Central Asia, and the Caucasus. Even as it maintains its position as the predominant global power, it is also engaged in hegemonic competitions in these regions with China in East and Central Asia, with Iran in the Middle East and Central Asia, and with Russia in Eastern Europe, Central Asia, and the Caucasus. The United States, too, is more of a traditional than a postmodern power, and though Americans are loath to acknowledge it, they generally prefer their global place as “No. 1” and are equally loath to relinquish it. Once having entered a region, whether for practical or idealistic reasons, they are remarkably slow to withdraw from it until they believe they have substantially transformed it in their own image. They profess indifference to the world and claim they just want to be left alone even as they seek daily to shape the behavior of billions of people around the globe. The jostling for status and influence among these ambitious nations and would-be nations is a second defining feature of the new post-Cold War international system. Nationalism in all its forms is back, if it ever went away, and so is international competition for power, influence, honor, and status. American predominance prevents these rivalries from intensifying — its regional as well as its global predominance. Were the United States to diminish its influence in the regions where it is currently the strongest power, the other nations would settle disputes as great and lesser powers have done in the past: sometimes through diplomacy and accommodation but often through confrontation and wars of varying scope, intensity, and destructiveness. One novel aspect of such a multipolar world is that most of these powers would possess nuclear weapons. That could make wars between them less likely, or it could simply make them more catastrophic. It is easy but also dangerous to underestimate the role the United States plays in providing a measure of stability in the world even as it also disrupts stability. For instance, the United States is the dominant naval power everywhere, such that other nations cannot compete with it even in their home waters. They either happily or grudgingly allow the United States Navy to be the guarantor of international waterways and trade routes, of international access to markets and raw materials such as oil. Even when the United States engages in a war, it is able to play its role as guardian of the waterways. In a more genuinely multipolar world, however, it would not. Nations would compete for naval dominance at least in their own regions and possibly beyond. Conflict between nations would involve struggles on the oceans as well as on land. Armed embargos, of the kind used in World War i and other major conflicts, would disrupt trade flows in a way that is now impossible. Such order as exists in the world rests not merely on the goodwill of peoples but on a foundation provided by American power. Even the European Union, that great geopolitical miracle, owes its founding to American power, for without it the European nations after World War ii would never have felt secure enough to reintegrate Germany. Most Europeans recoil at the thought, but even today Europe’s stability depends on the guarantee, however distant and one hopes unnecessary, that the United States could step in to check any dangerous development on the continent. In a genuinely multipolar world, that would not be possible without renewing the danger of world war. People who believe greater equality among nations would be preferable to the present American predominance often succumb to a basic logical fallacy. They believe the order the world enjoys today exists independently of American power. They imagine that in a world where American power was diminished, the aspects of international order that they like would remain in place. But that’s not the way it works. International order does not rest on ideas and institutions. It is shaped by configurations of power. The international order we know today reflects the distribution of power in the world since World War ii, and especially since the end of the Cold War. A different configuration of power, a multipolar world in which the poles were Russia, China, the United States, India, and Europe, would produce its own kind of order, with different rules and norms reflecting the interests of the powerful states that would have a hand in shaping it. Would that international order be an improvement? Perhaps for Beijing and Moscow it would. But it is doubtful that it would suit the tastes of enlightenment liberals in the United States and Europe. The current order, of course, is not only far from perfect but also offers no guarantee against major conflict among the world’s great powers. Even under the umbrella of unipolarity, regional conflicts involving the large powers may

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erupt. War could erupt between China and Taiwan and draw in both the United States and Japan. War could erupt between Russia and Georgia, forcing the United States and its European allies to decide whether to intervene or suffer the consequences of a Russian victory. Conflict between India and Pakistan remains possible, as does conflict between Iran and Israel or other Middle Eastern states. These, too, could draw in other great powers, including the United States. Such conflicts may be unavoidable no matter what policies the United States pursues. But they are more likely to erupt if the United States weakens or withdraws from its positions of regional dominance. This is especially true in East Asia, where most nations agree that a reliable American power has a stabilizing and pacific effect on the region. That is certainly the view of most of China’s neighbors. But even China, which seeks gradually to supplant the United States as the dominant power in the region, faces the dilemma that an American withdrawal could unleash an ambitious, independent, nationalist Japan. In Europe, too, the departure of the United States from the scene — even if it remained the world’s most powerful nation — could be destabilizing. It could tempt Russia to an even more overbearing and potentially forceful approach to unruly nations on its periphery. Although some realist theorists seem to imagine that the disappearance of the Soviet Union put an end to the possibility of confrontation between Russia and the West, and therefore to the need for a permanent American role in Europe, history suggests that conflicts in Europe involving Russia are possible even without Soviet communism. If the United States withdrew from Europe — if it adopted what some call a strategy of “offshore balancing” — this could in time increase the likelihood of conflict involving Russia and its near neighbors, which could in turn draw the United States back in under unfavorable circumstances. It is also optimistic to imagine that a retrenchment of the

American position in the Middle East and the assumption of a more passive, “offshore” role would lead to greater stability there. The vital interest the United States has in access to oil and the role it plays in keeping access open to other nations in Europe and Asia make it unlikely that American leaders could or would stand back and hope for the best while the powers in the region battle it out. Nor would a more “even-handed” policy toward Israel, which some see as the magic key to unlocking peace, stability, and comity in the Middle East, obviate the need to come to Israel’s aid if its security became threatened. That commitment, paired with the American commitment to protect strategic oil supplies for most of the world, practically ensures a heavy American military presence in the region, both on the seas and on the ground. The subtraction of American power from any region would not end conflict but would simply change the equation. In the Middle East, competition for influence among powers both inside and outside the region has raged for at least two centuries. The rise of Islamic fundamentalism doesn’t change this. It only adds a new and more threatening dimension to the competition, which neither a sudden end to the conflict between Israel and the Palestinians nor an immediate American withdrawal from Iraq would change. The alternative to American predominance in the region is not balance and peace. It is further competition. The region and the states within it remain relatively weak. A diminution of American influence would not be followed by a diminution of other external influences. One could expect deeper involvement by both China and Russia, if only to secure their interests. 18 And one could also expect the more powerful states of the region, particularly Iran, to expand and fill the vacuum. It is doubtful that any American administration would voluntarily take actions that could shift the balance of power in the Middle East further toward Russia, China, or Iran. The world hasn’t changed that much. An American withdrawal from Iraq will not return things to “normal” or to a new kind of stability in the region. It will produce a new instability, one likely to draw the United States back in again. The alternative to American regional predominance in the Middle East and elsewhere is not a new regional stability. In an era of burgeoning nationalism, the future is likely to be one of intensified competition among nations and nationalist movements. Difficult as it may be to extend American predominance into the future, no one should imagine that a reduction of American power or a retraction of American influence and global involvement will provide an easier path.

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Even if heg will collapse some day we should maintain it now for our protection.Thayer 2k7 Associate Professor in Defense and Strategic Studies Missouri State UniversityBradley A, “American Empire: A Debate,” Routledge 2k7, Reply to Christopher Layne, P.105

Each country knows it will never be perfectly secure, but that does not detract from the necessity of seeking security. International politics is a dan gerous environment in which countries have no choice but to participate. Any involvement—from the extensive involvement of the United States to the narrow activity of Switzerland—in this dangerous realm runs the risk of a backlash. That is simply a fact of life in international politics. The issue is how much participation is right. Thankfully, thus far the United States recognizes it is much better to be involved so that it may shape events, rather than to remain passive, having events shaped by other countries, and then adjusting to what they desire. In contrast to Layne's argument, maximizing the power of the United States aids its ability to defend itself from attacks and to advance its interests. This argument is based on its prodigious economic, ideological, and military power. Due to this power, the United States is able to defeat its enemies the world over, to reassure its allies, and to dissuade states from challenging it. From this power also comes respect and admiration, no matter how grudging it may be at times. These advantages keep the United States, its interests, and its allies secure, and it must strive to maintain its advantages in international politics as long as possible . Knowing that American hegemony will end someday does not mean that we should welcome or facilitate its demise; rather the reverse. The United States should labor to maintain hegemony as long as possible—just as know ing that you will die someday does not keep you from planning your future and living today. You strive to live as long as possible although you realize that it is inevitable that you will die. Like good health, Americans and most of the world should welcome American primacy and work to preserve it as long as possible.

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PLAN: THE UNITED STATES FEDERAL GOVERNMENT SHOULD IMPLEMENT A FEDERAL SINGLE-PAYER HEALTHCARE SYSTEM FOR ALL UNINSURED PERSONS IN THE UNITED STATES.

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Observation 3: Solvency

Only a single-payer system mitigates costs – Medicare proves. Schoonmaker, Global Sourcing Finance Chief at GE Healthcare, 7/20/09Anne. “Why not singlepayer?” Baltimore Sun. http://www.baltimoresun.com/news/opinion/readersrespond/bal-ed.le.letters200jul20,0,1114455.story [Mardjuki]

In a Q-and-A recently posted on the Web site Crooks & Liars (http://crooksandliars.com/node/29667), House Speaker Nancy Pelosi responded to one of the questions by saying, "For 30 years I have supported a single-payer plan, but our next best choice is to support an exchange and a public option." The question that her response prompts from me is, why are we giving up on the best solution and settling for something that, from all appearances, is a whole lot less than "next best?" The House plan is not set to go "live" until January of 2013 . No, that is not a typo. If I told you that in less than a year after the historic Medicare legislation was signed into law, the program was up and running, and millions of older Americans had been enrolled and were getting health care with hardly a hiccup, wouldn't you wonder why it's going to take so long to get essential elements of this version of reform in place? Wouldn't you wonder why the elements that are designed to help the millions of uninsured are the ones that are going to take the longest to implement? Or, maybe, you wondered if there's a political reason why the plan won't be fully operational until 2013, like the fact that we will have a presidential election in November of 2012, and it might not be good for the fortunes of the current president or the senators and representatives up for re-election if a new health care system is not going well or is not all it was advertised to be. So, what will the millions of currently uninsured people do between now and 2013? And, with an economy in decline, thousands of people losing their jobs every month and losing their coverage, with more employers changing to plans that cover less and cost the individual more, or dropping coverage altogether, how much more dire will things be in four years? What will the insurance companies be doing between now and 2013? How will they be positioning themselves to accommodate the changes that are coming? What will we see from them in the next 3 1/2 years that will signal they have even the slightest interest in improving our access to and delivery of actual health care? What this is really all about, where the focus should have been from the start, is health care, not insurance. Having a shiny new insurance policy will not help if the out-of-pocket costs are such that people still cannot afford to see the doctor or get the medications they need. All of the major developed nations have some form of single-payer health care. Their spending per-person on health care is less than half what we spend here, and their people are, by most accepted measures, healthier than we are . Why are we writing 1,000-plus-page bills, creating a Rube Goldberg -ian system whose biggest benefit will be to insurance companies that have done nothing in the last several decades to improve the current system - but a lot to assist the political careers of more than a few members of Congress who are crafting this "reform" (and making those who need accessible and affordable care the most wait the longest to get it) - when we have a single-payer model, Medicare, that we know works well and could be expanded or duplicated with relative ease and in a much shorter period of time?

Single payer harnesses the market’s strength and maximizes efficiency. Prajwal Ciryamv, 9-5-2008, MD/PhD from Northwestern University, “A Market for Compassion: Single-Payer Health Insurance”, http://www.pubmedcentral.nih.gov/articlerender.fcgi?artid=2580082

In a single-payer system, the government will fund health insurance, but private providers will continue to deliver care. Economies of scale will save the money to make this possible. Many Americans, including Democratic presidential nominee Barack Obama, concede that single-payer insurance is probably our most efficient option.[2] But they worry that it lacks the spirit of the American market. Nothing could be further from the truth . A single-payer system will harness the market's strengths while addressing its limitations. The private health insurance market is inefficient, bloated by advertising, duplicated bureaucracies, dividends, and executive compensation. What's worse, insurance policies are so complex and individuals' future needs so unpredictable that consumers cannot make the informed selections that induce competition between insurers. However, consumers can create competition among healthcare providers. This is paramount because patients need the best healthcare, not the best middlemen to pay for it. Currently, providers are insulated from competition because private insurers often restrict coverage to select physicians. In addition, the 47 million uninsured Americans[3] have little impact on the market. A single-payer system will give all consumers the power of choice and open all healthcare providers to the effects of consumer decisions. Single-payer works because of the efficiency of specialization.

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The government will manage the paperwork and private entities will provide the care. Adam Smith would be proud.

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Medicaid reform must be considered in the context of massive healthcare restructuring – Medicaid is the starting point of effective reform.De Alteriis, director of Medical Health Administration. 1992.Martin. “Medicaid’s Role in Moves Toward Universal Health Care.” Policy Studies Review, Winter 1992, Volume 11. [Mardjuki]

Proposals for reform are usually combined into packages. One package designed to increase Medicaid eligibility and control costs would make poverty the sole criterion for eligibility and rely on managed care to contain costs (Oberg and Polich, 1988). A more radical package would divide the acute care and long-term care components of Medicaid, make poverty the criterion for eligibility, block grant long-term care and change the federal funding formulas for acute-term care (Holahan and Cohen, 1987). These reforms always have several desirable goals, such as increased or equalized coverage, but they do not consider Medicaid reform in the context of radical reform of the American health care system. This is a mistake. While the proposals could lead to some improvements in Medicaid, major problems would remain unsolved . The Medical Assistance program is greatly affected by the actions of other health care programs. If private insurers raise physicians' fees in a state, more physicians will see private patients and fewer will see Medicaid eligibles. If a change in the Medicare program's reimbursement ra tes lowers hospital profit margins, this will likely affect Medicaid recipients. If Medicaid inpatient rates are relatively low, hospitals will probably try to decrease the number of Medicaid recipients they admit (or their lengths of stay in the hospital) and attract more privately insured patients to compensate for the lost Medicare revenue. If the Medicaid inpatient rates are relatively high, the hospital will probably try to increase the number of Medicaid recipients they admit (or their lengths of stay in the hospital) to recoup the lost Medicare revenue, Most of Medicaid's problems can be traced to the principles which characterize the program. Medicaid is a welfare benefit -not a right-to be granted by the states, at their discretion. Consequently, horizontal inequities are not surprising. Medicaid must compete in a health care system run by market forces. As the payer of the last resort, offering the lowest reimburse must be expected. Only by changing these principles and combining Medicaid reforms with major structural reforms of American health care system can Medicaid's problems be solved. In the process, the nation's health care system could be transformed. For just as surely as Medicaid reform proposals that ignore the nation's health care system as whole will have limited success, so proposals to reform the nation's health care that do not fully consider Medicaid will have a less positive impact than they otherwise might . If affordable universal coverage is our goal, there is a logic to starting with the reform of the Medicaid program. Medicaid already covers a large proportion of the poor and uninsurable. As it is a government program, its reform will not threaten the private health care industry. We have a solid body of research specifically about Medicaid to guide us. Furthermore, we can also draw on research into the Medicare program and into other nations' public health care systems. If we take this approach, we should include the following elements in our reforms.

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Single-payer system for the uninsured would function as a demonstration of a scalable model for the rest of the country – creates impetus for expansion and nation-wide adoption.Klein, economic and domestic policy expert. 7/27/09.Ezra. “A Market for Health Reform.” Washington Post. http://www.washingtonpost.com/wp-dyn/content/article/2009/07/28/AR2009072802114_pf.html [Mardjuki]

The central problem in health-care reform is that good policy and good politics point in opposite directions. Good policy proceeds from the understanding that our health-care system is a fractured, pricey, inefficient mess. Good politics, however, proceeds from the insight that a lot of people rely on this fractured, pricey, inefficient mess and don't trust Washington to change it. Good politics means, as Barack Obama frequently says, that if you like what you have, you get to keep it. But put those imperatives together and you have a strange problem indeed: How do you reform a system that you're not allowed to change? The answer that reformers have come up with is that you don't change the current system. In the short term, you strengthen it with subsidies and regulations on insurers. You make it kinder and gentler. But you also build the beginnings of a new, better health-care system off to the side. You let it demonstrate its efficiencies and improvements. You let the lure of lower costs and higher quality persuade Americans to migrate over of their own accord. This is what the health insurance exchange is designed to do. It is arguably the single most important element of health-care reform, because it is the bridge between the system we have and the system we want. But amid the clamor over public insurance options -- which, incidentally, would be housed on the exchange -- and employer tax exclusions and all the other points of controversy, the health insurance exchange is hardly being discussed. And there are signs that it, and thus the long-term promise of reform, might be in danger. Compared with the crazy-quilt system we have now, the idea behind the health insurance exchange is almost weirdly simple: It's a single market, structured for consumer convenience, in which you choose between the products of competing health insurers (both public and private). This is not a new idea. It is how we buy everything from books to socks to soup. Everything, that is, except health insurance. The benefits of reversing that bit of accidental exceptionalism are obvious to anyone who has ever stepped inside a Target: Consumers will benefit from more choice, from direct competition between insurance providers hungry for their business, from regulations meant to protect them from deceptive products, from efficiencies of scale, and from the sort of purchasing power that only a large base of customers can provide. They will benefit, in other words, from an actual, working market -- something health insurers have managed to avoid for far too long. But all health insurance exchanges are not created equal. Just as there's a weak and strong version of the public plan, there's a weak and strong version of the exchange. The strong version is national, or at least regional. It's open to everyone: The unemployed, the self-employed and any business, no matter the size, that wants to buy in. There's risk adjustment to reduce the incentive for cherry-picking. The huge pool of users gives the exchange tremendous advantages in scale, simplicity and standardization (experts say that you need at least 20 million to fully achieve these benefits -- easy in a national exchange but harder in a regional or state-based one). With so many potential customers, insurers are eager to participate, and they will bid aggressively to ensure they're included in the market and compete aggressively to make sure they're successful within it. Over time, the combination of increased efficiencies and greater competition drive down costs, which will lead more employers to use the exchange, which will in turn give it more scale and bargaining power. You could easily see this exchange slowly emerge as the de facto American health-care system. And not through government fiat. Through consumer choice. The weak version is state-based. It's open to only the unemployed, the self-employed and small businesses. Risk adjustment, if it exists at all, is crude. With such a limited pool of applicants, insurers aren't driven to compete, and the efficiencies of scale and competition are minimal. It never really grows, and instead exists as a marginal policy to mop up those who aren't covered by employers. Sort of an outlet shopping model for health-care, accessible only to the few able to get there. Right now, the weak version is a lot likelier than the strong version, for a couple of reasons. One is that there are tricky policy problems in a strong exchange. The largest of these is adverse selection: If you open it to large employers, but the only large employers who join are those with aging and ill workforces, then costs will shoot up. There are, however, ways to address that problem: In particular , risk adjustment, which the Netherlands, Germany and every other largely private universal health-care system uses to deal with similar issues, can be deployed to make sure no insurer is penalized for signing up sicker customers and no insurer benefits from signing up healthier customers . This is not an insurmountable policy problem. But there is a tricky political problem: If the exchanges are effective, and open to everyone, then workers and employers alike might well decide to use them. Politicians are very interested in the optics of preserving current insurance arrangements. They are afraid of a Congressional Budget Office estimate that says something like "80 million Americans will transition from employer-based health insurance to the exchange." That estimate, translated into political-speak, will come out sounding like "80 million Americans will lose what they have." And that scares people, which scares politicians. Some politicians, however, remain uncowed. Oregon Democrat Ron Wyden has proposed something he calls the Free Choice Act: It would open the exchanges to all Americans and all businesses. It would also let those of us with employer-based insurance take the money our employers are paying for our insurance and use it on the exchange instead. This idea wouldn't take away what anyone has. But it would allow those of us who don't like what we have to change it. More so than any other idea in the health-care debate, it offers a concrete way that reform could benefit the insured. It gives them a way out of a health-care system that is eating through their wages and limiting their choices. And that's no small gain. The only way that health-care reform will truly give us a more efficient, more effective, more affordable health-care system is if it begins to fundamentally change the inefficient, ineffective, unaffordable system we have now.

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Expanding Medicaid builds support for universal care – it’s the only way to neutralize political objectionsMichael Sparer, Ph.D., J.D., professor of health policy at the Mailman School of Public Health, Columbia University, 2009 (Michael Sparer, “Medicaid and the U.S. Path to National Health Insurance,” January 22, 2009, http://healthcarereform.nejm.org/?p=300)

The 2008 presidential election has rekindled long-simmering hopes for comprehensive health care reform. The policy debate includes references to new government programs (perhaps a federal program for the uninsured to buy into) and vague formulas for cost containment (usually involving overly optimistic assessments of savings to be generated by using health information technology). Ironically, however, the debate generally ignores what I see as the most plausible path toward universal coverage: first, expanding Medicaid to cover the largest portion of the uninsured, Americans with incomes below 350% of the federal poverty level (around $62,000 for a family of three); and second, requiring everyone to carry health insurance and allowing people whose incomes are too high for automatic coverage to buy into Medicaid. Previous efforts to enact universal coverage have failed in part because opposition from interest groups such as the business community and the insurance industry is far more influential than is organized support for uninsured low-wage workers. Reform opponents also take advantage of the anti–big-government ethos that pervades our political culture. Finally, our political institutions are designed to make it hard to enact comprehensive legislation, since our system of checks and balances provides opponents with numerous opportunities to block legislation.1 Meanwhile, Medicaid, the federal–state program designed to provide health insurance for the poor, has been quietly becoming the most successful program in U.S. history for aiding the uninsured. Since the Reagan administration, program enrollment has more than doubled (surpassing 59 million), softening the impact of the continuing decline in the number of Americans with employer-sponsored coverage. Surprisingly, the very factors that defeated President Bill Clinton’s proposal for universal coverage have actually encouraged expansions of Medicaid. Business leaders support Medicaid expansions because they relieve the pressure on employers to cover low-wage employees. Private insurers support such initiatives because they leave intact the core of the current system and because many states use commercial health plans to serve Medicaid beneficiaries. Institutional providers (hospitals and nursing homes) are supportive, since they rely on Medicaid dollars. Medicaid is also administered in very different ways by different states, which minimizes complaints about a monolithic national program. Perhaps most important, Medicaid’s intergovernmental structure encourages expansion: since the program is financed primarily with federal dollars, states can increase coverage while shifting much of the cost to the federal treasury.2 The 2007 battle over Medicaid’s sister program, the State Children’s Health Insurance Program (SCHIP), illustrates this broad acceptability. The congressional proposal to increase SCHIP funding emerged from a bipartisan process and was supported by both Senator Edward Kennedy (D-MA) and Senator Orrin Hatch (R-UT). Even President George W. Bush hoped to increase funding, though by less than Congress had proposed. The bone of contention was the income ceiling for eligibility. New Jersey, at the high end, covers children from families with incomes up to 350% of the federal poverty level. That’s about as high as moderate Republicans (and the business community) might plausibly be willing to go. This history points us to an obvious path toward national health insurance: combine a Medicaid expansion and buy-in with an individual mandate. Most Americans would find it fair to require those who can afford insurance to buy it, especially when they can pay into an affordable public insurance plan rather than being forced to buy private policies. I believe that this is the only universal coverage plan with a decent chance of succeeding politically. Employer mandates face treacherous politics: big business doesn’t want government telling it what sort of coverage to provide, and small business argues persuasively that many “mom and pop” shops simply cannot afford the bill. Even less likely to fly are Medicare-expansion proposals, given both the cultural opposition to anything that could be labeled a single-payer program and the fierce opposition of the private insurance industry. But the same interest groups that would oppose these alternatives would probably support the Medicaid strategy. Relying on Medicaid is also good policy. Medicaid provides decent health insurance to more than 59 million Americans (including more than 25% of U.S. children).3 Some people complain about interstate variation in eligibility, benefits, and reimbursement, but if eligibility were standardized and minimum benefits defined, variation in other areas could result in learning and innovation. Medicaid encourages state-based experimentation in responding to local health care needs. For example, most states deliver benefits through managed care, but some rely on commercial insurers and some on nonprofit health plans, whereas others act as the plan themselves. And Medicaid offers such flexibility within an overarching federal structure. Similarly, interstate diversity in cost-containment strategies, programs for the chronically ill, and outreach and education is a good thing. Moreover, states are already experimenting with Medicaid buy-in programs, and one state (New Jersey) has even enacted an initiative combining a Medicaid buy-in with an individual mandate for parents to cover children.4 Letting the laboratory of federalism work is a better idea than using Medicare or the congressional health plan as the basis for a reformed system — and a much

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better idea than creating a brand-new administrative infrastructure. However, the road to any type of national health insurance is littered with obstacles, and the “Medicaid for More” model certainly faces barriers. First is the stigma attached to the name.

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Many middle-class workers would be reluctant to buy into a “welfare medicine” program. One solution is to give the program a new name and thus a new identity as a middle-class entitlement. States tried this strategy with some success when implementing SCHIP (hence the “Dr. Dynasaur” program in Vermont). More difficult would be convincing physicians to support a Medicaid expansion and participate in the program. Although Medicaid participation is high in some states, it is more typical for office-based physicians to refuse to treat Medicaid patients, citing low reimbursement rates and long administrative delays.5 Medicaid agencies (or the managed-care plans they rely on) will need to pay higher rates, though increases that are substantial enough to attract physician participation would undermine cost-containment efforts. Medicaid agencies could also rely more heavily on nurse practitioners and physician assistants, but any effort to simply bypass the physician community will fail. Here again, however, the laboratory of federalism could help, since there are states that effectively partner with office-based physicians and have lessons to share. Finally, there is the question of paying the bill, especially in the midst of an economic crisis. Here, too, there are no easy solutions, especially for a society disinclined to limit the diffusion of new health care technology or to regulate the prices and salaries paid by the private health care sector. One lesson of the recent Medicaid expansions, however, is that intergovernmental financing programs are the most plausible fiscal route to health insurance expansions. States will complain about having to pay their share, though Congress could tie increased federal funding to innovative case management for chronic diseases (or other performance measures). Federal budget officials will also be skeptical, but any national health insurance system is going to cost money, and at least in this scenario the cost would be divided among the federal treasury, the states, and the businesses or individual consumers who buy in. Proposals for national health insurance have a long history of failure in this country. But expanding Medicaid in combination with an individual mandate offers a good policy solution that might have enough political appeal to succeed. And if the recession and other priorities discourage President Obama from seeking universal coverage in one fell swoop, the model could be phased in, starting with a more modest Medicaid expansion, a buy-in program, and an individual mandate covering only children. Ultimately, I see the Medicaid model as providing the most likely path to solving the crisis of the uninsured.

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**INHERENCY**

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Obama HC Inev

Some type of healthcare reform is inevitable – Democrats must support it to save Democratic face and preserve their own careers even if they’re opposed to it.Chait, senior editor. 7/21/09.Jonathan. “Why Health Care Reform Will Pass.” The New Republic Journal. http://blogs.tnr.com/tnr/blogs/the_plank/archive/2009/07/21/why-health-care-reform-will-pass.aspx [JM]

Michael Tomasky analyzes the political logic of red state Democrats: Look at it this way. There are four possible outcomes on healthcare, or any piece of legislation: 1. It passes, and they vote for it. 2. It passes, and they vote against it. 3. It fails, and they vote for it. 4. If fails, and they vote against it. So let's look at each of these vis-a-vis healthcare the way a centrist legislator might look at them. Outcome 1: Not a bad outcome, because it's a big party victory. But there are lots of unknowns. Fear of the unknown is all-consuming for legislators who think they might be vulnerable to defeat someday. Undoubtedly, given something as large and complex as healthcare, there are going to be problems and disappointments with the new system. Will those problems, the solon thinks, be hung around my neck when I seek reelection? Outcome 2: Preferable to 1, because now, when problems arise with the reforms, they can say, hey, don't look at me. I tried to tell my more liberal colleagues that this would happen, which is why I supported the provision that would have...Outcome 3: The worst possible outcome, for what I should think are obvious reasons. They've stuck their necks out for nothing and practically begged to be accused of "being out of touch" with the voters of their conservative state.Outcome 4: In many ways, the best outcome of all, from a purely short-sighted and self-interested perspective. Few unknowns. And to the extent that their president and their party are damaged, they can always say well, they went too far to the left, which makes it all the more important that people like me stay in Washington. I disagree. I'd order the outcomes like so, from best to worst: 1. It passes, and they vote against it. 2. It passes, and they vote for it. 3. It fails, and they vote against it. 4. If fails, and they vote for it. If health care reform fails, then Obama is toast, and the Democratic brand along with it. Having voted against the bill will provide little cover for moderate Democrats, as the 1994 elections show. Now, it's true that you can't pass an effective health care reform without stepping on some toes. That's why the best possible scenario for Democrats is to have the bill pass with them voting against it, so they can't be held responsible for the toes that get stepped on. That's also why they're trying to get bipartisan support, which could give them cover, or possibly even the spare votes to allow them to vote against it. But, at the end of the day, they're going to have to decide whether to pass the bill or not. Specifically, Democrats will have to decide whether or not to support a filibuster of health care reform that would destroy their president and dig their own grave. And that's the main difference between now and 1994 -- health care can't be filibustered without Democratic cooperation. I can't see them doing it. Members of Congress may not be geniuses, but they're usually pretty good at discerning their own political self-interest. And that's why I think we'll end up with a health care bill. A perfect bill? No. But the distance between the status quo anda perfect bill is so vast that we could have something that's both a massive, historical improvement and a crushing disappointment. That's what I think we'll get.

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Healthcare reform inevitable.VOA News 7/14/09“Obama: Health Care Improvements Inevitable.” http://www.voanews.com/english/2009-07-14-voa2.cfm [Mardjuki]

U.S. President Barack Obama says improvements in the American health care system are inevitable. Mr. Obama made his comments in the White House Rose Garden Monday as he nominated an African-American woman, Regina Benjamin, to become the U.S. Surgeon General.  The president said "naysayers and cynics" should not bet against the passage of health insurance legislation. He also said inaction on the issue is not an option. Mr. Obama has vowed to sign a health care bill into law this year. Democrats in the House of Representatives say they are nearly ready to unveil their health care reform plan.

Health care will pass – AMA backing.Nasaw, Washington correspondent. 7/16/09.Daniel. “Powerful doctors groups backs Obama’s healthcare reform plan.” UK Guardian. http://www.guardian.co.uk/world/2009/jul/16/obama-health-plan-ama-support [Mardjuki]

American Medical Association, which vigorously opposed Bill and Hillary Clinton's 1990s reform effort, today pledged to work with congressional leaders to ensure legislation is soon passed. The group endorsed the strongest legislation currently on the table, proposed this week by top Democrats in the House of Representatives. The group long opposed government intervention in the healthcare system for fear that its physician members would see their lucrative pay decline. With no universal public programme akin to the National Health Service, Americans rely on a patchwork of employee-provided healthcare, government programmes for the poor, elderly and veterans, and costly private health insurance coverage. Americans spend one out of every six dollars on healthcare - roughly twice as much per capita as other industrialised nations - but lag behind in life expectancy, infant mortality and other health indicators . The medical association's surprise turnaround may be an indication they see reform as inevitable and hope to influence the legislation at the margins. In its letter to Charles Rangel, a powerful New York Democrat, the group said it hoped for "constructive dialogue" during revision of the legislation. "We pledge to work with the House committees and leadership to build support for passage of health reform legislation to expand access to high quality, affordable health care for all Americans," the group wrote in a letter signed by executive vice president Michael Maves.

Healthcare inevitable – Obama pulling out all stops.Murray, White House correspondent. 7/13/09.Mark. “Obama: Don’t Bet Against Health Reform.” MSNBC. http://firstread.msnbc.msn.com/archive/2009/07/13/1994860.aspx [Mardjuki]

But the president   also used the announcement as a kind pep talk on health-care reform, as congressional watchers and the press have begun to doubt whether Congress can meet   his goal to pass reform bills before it goes on its August recess.  "We are going to get this done," Obama said. "Inaction is not a option." He added, "Don't bet against us. We are going to make this happen." And mentioning a sports/exercise metaphor he's used before, Obama said that Washington's muscles for enacting change have atrophied. So: "We are whipping folks back into shape."

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Obama will ram healthcare through Congress – highest odds now.Trende, staff reporter. 7/24/09.Sean. “Why Obama Isn’t Governing From the Center.” Real Clear Politics. http://www.realclearpolitics.com/articles/2009/07/24/why_obama_isnt_governing_from_the_center_97591.html [Mardjuki]

In other words, Obama realizes that the odds are not likely going to improve for the implementation of an aggressively liberal agenda. Right now, he is in the midst of a liberal moment , where he has governing majorities in each House. He wants to get a health care bill through that is the closest to his philosophy, and he knows that future Congresses are unlikely to have similarly hearty Democratic majorities. So he’s “going for it,” knowing that if he can ram a bill through – and with a 80-seat majority in the House I think he ultimately will be able to – it will probably never be repealed, even if Republicans surge back in 2010. If he doesn’t do it now, he will likely be relegated to pursuing an incrementalist strategy, similar to what the Democrats have been pursuing since 1994. If you accept that Obama truly is a solid liberal at heart, not a centrist, and that he’s ultimately at least as concerned about getting this agenda through as he is getting re-elected, then his present approach makes sense.

Health care industry and moderate Republicans negotiating – recognize healthcare inevitable.Pershing, staff reporter. 7/10/09.Ben. “Is health-care reform inevitable?” Washington Post. http://voices.washingtonpost.com/political-browser/2009/07/is_health-care_reform_inevitab.html [Mardjuki]

Is health-care reform inevitable? That question has come to the fore in recent days, as President Obama and Democratic leaders on Capitol Hill attempt to navigate a maze full of opposition and entrenched interests to arrive at a reform package. Politics is all about leverage, and for now, the pro-reform forces have it. That's why so many potential opponents of the White House's efforts -- drug companies , hospitals , moderate Republicans -- have been willing to sit down and negotiate on the issue. If health-care reform is inevitable, they'd rather make some sacrifices and have a seat at the table then be caught outside the room when the deal is made.

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Crisis coming – allowing Congress to control creation of healthcare legislation dooms reform to failure.Goldman, staff director of Subcommitee on Health and Scientific Research, director @ National Institute of Health, Senior Executive Service. 7/28/09.Leroy. “A Plan to Rescue Health Care Reform.” Asheville Citizen Times. http://www.citizen-times.com/apps/pbcs.dll/article?AID=/20090728/OPINION07/90723059&template=printart [Mardjuki]

The Medicare Trustees have recently reported that its Trust Fund will be exhausted by 2017. Medicaid, as currently configured, is a burden that the several states cannot adequately sustain going forward. The solvency of Social Security will face the same fate in twenty years. And next year the front edge of the 77 million Baby Boomers will be expecting these programs to support their retirement. Those in the know understand that health care costs now amount to $2,500,000,000 000—16% of GDP. They know that these costs are utterly out of control. They know that, unless they are brought under control, they imperil not only the health care system, but also the entire national economy. America faces another 911. But unlike the attack that occurred at the Twin Towers, we know that this one is coming. Allowing it to happen in the face of certain knowledge about its inevitability and the devastation it will cause is unpardonable . But, while the “experts” know what is coming, the American public does not. The President is the only person who can make this case to the nation. He needs to do so immediately. That effort on his part will not only inform the nation. It will create the political will on the part of Congress to enact Health Care Reform and to avert a calamity that will otherwise make the current financial and credit crisis seem tame by comparison. The Administration’s game plan thus far is deeply, fatally flawed. Having turned over the principal responsibility of writing the legislation to the Congress, it has allowed the destructive and polarizing forces that rule on Capitol Hill to take control of the process and doom it .

Senate/House rivalry and lobby influence guarantees that reform will be ineffective.Goldman, staff director of Subcommitee on Health and Scientific Research, director @ National Institute of Health, Senior Executive Service. 7/28/09.Leroy. “A Plan to Rescue Health Care Reform.” Asheville Citizen Times. http://www.citizen-times.com/apps/pbcs.dll/article?AID=/20090728/OPINION07/90723059&template=printart [Mardjuki]

The hard fact of the matter is that the nation faces this crisis because for decades the Congress and previous administrations have been unwilling to forthrightly prescribe the medicine needed to fix this mess. They have been unwilling because doing so involves pain and sacrifice by their constituents. As they have delayed and taken the easy road, the price of the fix has grown to the point that it has paralyzed effective action . If that isn’t a prescription for disaster, what is? So simply expecting the Hill to write the bill the nation needs is foolish and certain to fail . Why? For reasons that are obvious. First of all there is the inherent and overly destructive rivalry between the House and the Senate. Second, the process is largely in the hands of staffers who by instinct base their action on their number one objective—protect the boss. Give me a break. These bosses don’t need protecting. 97% of them win reelection automatically. In addition, they turn for ideas and for affirmation of their ideas to the lobbyists who bankroll their boss’ reelection campaigns. These lobbyists, all of them, do not have the nation’s interest as their agenda. They exist to protect the interests of their clients. These are the folks who have proven that they are not capable of fixing this mess.

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Obama HC Fails - Cost

Democrats defecting – healthcare proposals on the table don’t cut costs and exacerbate job loss.Pear, senior writer, Herszenhorn, reporter. 7/17/09Robert and David. “Democrats Grow Wary as Health Bill Advances.” New York Times. http://www.nytimes.com/2009/07/18/health/policy/18health.html?pagewanted=print [Mardjuki]

Three of the five Congressional committees working on legislation to reinvent the nation’s health care system delivered bills this week along the lines proposed by President Obama. But instead of celebrating their success, many Democrats were apprehensive, nervous and defensive. Even as Democratic leaders and the White House insisted that the nation was closer than ever to landmark changes in the health care system, they faced basic questions about whether some of their proposals might do more harm than good. And while senior Democrats vowed to press ahead to meet Mr. Obama’s deadline of having both chambers pass bills before the summer recess, some in their ranks, nervous about the prospect of raising taxes or proceeding without any Republican support, were pleading to slow down. Democrats had three reasons for concern. The director of the Congressional Budget Office warned Thursday that the legislative proposals so far would not slow the growth of health spending , a crucial goal for Mr. Obama as he also tries to extend insurance to more than 45 million Americans who lack it. Second, even with House committees working in marathon sessions this week, it was clear that Democrats could not meet their goal of passing bills before the summer recess without barreling over the concerns of Republicans and ending any hope that such a major issue could be addressed in a bipartisan manner. Third, a growing minority of Democrats have begun to express reservations about the size , scope and cost of the legislation , the expanded role of the federal government and the need for a raft of new taxes to pay for it all. The comments suggest that party leaders may not yet have the votes to pass the legislation. Mr. Obama tried Friday to shift the political narrative away from the grim forecasts of the Congressional Budget Office. He said he and Congress had made “unprecedented progress” on health care, with even the American Medical Association endorsing the House bill this week. He acknowledged a treacherous path ahead, saying, “The last few miles of any race are the hardest to run,” but insisted, “Now is not the time to slow down.” And he vowed: “We are going to get this done. We will reform health care. It will happen this year. I’m absolutely convinced of that.” On Capitol Hill, the picture is more complex. Representative Jared Polis, a freshman Democrat from Colorado who voted against the bill approved Friday in the Education and Labor Committee, said he worried that the new taxes “could cost jobs in a recession .” To help finance coverage of the uninsured, the House bill would impose a surtax on high-income people and a payroll tax — as much as 8 percent of wages — on employers who do not provide health insurance to workers. Mr. Polis said these taxes, combined with the scheduled increase in tax rates resulting from the expiration of Bush-era tax cuts, would have a perverse effect. “Some successful family-owned businesses would be taxed at higher rates than multinational corporations,” he said. In a letter to the House speaker, Nancy Pelosi, Mr. Polis and 20 other freshman Democrats said they were “extremely concerned that the proposed method of paying for health care reform will negatively impact small businesses, the backbone of the American economy.”

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Obama HC Fails - Concessions

Obama’s healthcare rushed – ineffective and too many concessions.Pear, senior writer, Herszenhorn, reporter. 7/17/09Robert and David. “Democrats Grow Wary as Health Bill Advances.” New York Times. http://www.nytimes.com/2009/07/18/health/policy/18health.html?pagewanted=print [Mardjuki]

And in the latest sign of lawmakers’ chafing at Mr. Obama’s ambitious timetable, a bipartisan group of six senators, including two members of the Finance Committee, sent a letter to Senate leaders pleading with them to allow more time. “While we are committed to providing relief for American families as quickly as possible,” they wrote, “we believe taking additional time to achieve a bipartisan result is critical for legislation that affects 17 percent of our economy and every individual in the United States.” The group included three senators, Ben Nelson, Democrat of Nebraska; and Olympia J. Snowe and Susan Collins, Republicans of Maine, who met with Mr. Obama at the White House this week and urged him not to rush the bill. “The legislative process right now is going in the wrong direction,” said Senator Joseph I. Lieberman , the Connecticut independent, who also signed the letter. “I think it’s extremely doable to get this done before the end of the year. But just to try to get it passed in the Senate before we leave for the August recess seems just about impossible. It’s just too big a bill.” The House education committee approved the bill, 26 to 22, on Friday morning, after an all-night session. Three Democrats crossed party lines and voted no. The vote came eight hours after the House Ways and Means Committee approved a nearly identical bill, 23 to 18, with 3 Democrats voting no. On Wednesday, the Senate health committee approved a generally similar bill on a party-line vote, 13 to 10. The House and Senate bills would require insurers to take all applicants and vastly expand coverage, with federal subsidies for millions of people. But the director of the Congressional Budget Office, Douglas W. Elmendorf, testified on Thursday that doing so would come at a steep cost and that the proposals would not curb the rise in health spending by the federal government, which he called “unsustainable.” A budget office analysis released Friday said the House bill would “result in a net increase in the federal budget deficit of $239 billion” over 10 years, partly because of an increase in Medicare spending to avert sharp cuts in payments to doctors. House Democrats who voted no cited various concerns. “ We are not doing enough to reform the health care delivery system, to change the incentives so reimbursement will be based on the value, rather than the volume, of services,” Representative Ron Kind of Wisconsin said.

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Obama HC Fails – Industry Profit

Big Pharma strangehold – health care industry stands to profit from current reform Marshall, George Polk Award winner, chief reporter, July 15, 2009. Joshua. “The case for keeping “single payer health care” off the table.” Talking Points Memo. http://tpmcafe.talkingpointsmemo.com/talk/blogs/jpieterick/2009/07/the-case-for-keeping-singe-pay.php?ref=reccafe [Mardjuki]

And herein lies the reason that a "single payer" health care solution had to remain off the table if we were to proceed with any kind of health care reform in this country. After all, if such a proposed solution were to be given serious discussion, much of what the consumer has already determined intuitively would be fleshed out in facts and figures. A full litany of efficiencies to be gained and resources to be reallocated from private industry profits and logistical support to the actual provision of health care would be enumerated, showing the way in which we could achieve universal health care without actually spending more money than is already dedicated to health insurance and health care. And that would be a good thing, right? Well, yes it would, unless you were one of the insurance companies or Big Pharma or the health care industry that has bled our health care system dry. Alas, the prime thing the consumer realizes intuitively is that the majority of waste and the inefficiencies under which our health care system suffers is related to the parasitical tagalong that is the insurance/health care/Big Pharma industries. And the possibility of the consumers acting upon that realization has the executives in these industries losing sleep. It is an unfortunate political reality that it is these parasites who own so much of Congress in these days of pay-to-play politics. And so any potential that the door would be open to arrive at a "throw the bums out" solution to health care reform by honestly considering single payer would never have been allowed to gain traction at all as Obama embarked on this process. On the other hand, successfully eliminating single payer as an option to be considered allowed the monied interests to reason it was safe - nay, potentially highly profitable - to proceed with Obama's "health insurance reform." These health insurance industry providers calculated that they could improve their take from the health care system if they smartly played the reform game. Senator Max Baucus of Montana, Chair of the Finance Committee and one of the biggest benefactors of health care industry campaign contributions, seemed to carry their water quite well for so long as he was able. Stating strong opposition to any public option, Baucus' was instead inclined toward a solution wherein we would eventually subsidize consumers as necessary until we achieved universal health insurance coverage. Executives at the major insurance providers were nearly besides themselves in planning the next Congressional fundraisers, undoubtedly certain that they could double, triple, nay quadruple their budget for campaign contributions at a mere fraction of the profit to be made from the 42 million new customers they stood to realize out of this proposed "reform" package.

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Obama HC Not Single Payer

Single-payer healthcare not in Obama’s bill NPR, 6-16-2009, “Single-Payer Health Care Not In the Plans” http://www.npr.org/templates/story/story.php?storyId=105442888

As lawmakers on Capitol Hill hammer out legislation to overhaul the nation's health care system this year, Health and Human Services Secretary Kathleen Sebelius says that a single-payer option is not on the table."This is not a trick. This is not single-payer," Sebelius told Steve Inskeep. She added: "That's not what anyone is talking about — mostly because the president feels strongly, as I do, that dismantling private health coverage for the 180 million Americans that have it, discouraging more employers from coming into the marketplace, is really the bad, you know, is a bad direction to go." Remaking the nation's health care system is a massive task: The industry constitutes 18 percent of the U.S. gross domestic product. But those skyrocketing health care costs — and the increasing burden they put on the U.S. economy — are exactly why the president says a health care overhaul must be a national priority.

Obama’s healthcare bill excludes single payer which weakens the bill Glen Ford, 7-17-2009, reporter for the Black Agenda Report, “Obama’s Single Payer Beat Down”, http://www.zmag.org/znet/viewArticle/22033

President Obama has escalated his campaign to suppress single-payer healthcare advocates, hinting darkly that there will be repercussions if unions and activists persist in harassing his fellow center-right Democrats. In a pre-Fourth of July teleconference with Democratic congressional leaders, Obama lectured, "We shouldn't be focusing resources on each other. We ought to be focused on winning this debate."The president was attempting to shut down paid media messages seeking to pressure corporatist Democrats to support some sort of public healthcare option "" an option that Obama claims to favor, although in terms so vague his own chief of staff, Rahm Emanuel, framed the issue as "negotiable." The ads have been embarrassing to rightist Democrats who are Obama's true political soulmates and a bridge to Republicans he seeks to woo.Obama's modus operandi is by now well known. His reflexive instinct is to lash out to his left when frustrated, to demand progressives stand down and await his marching orders - even when, as is the case most of the time, Obama's own direction is unclear, at best."Obama's reflexive instinct is to lash out to his left when frustrated."The objects of his ire are advertisements or fundraisers produced by MoveOn, Health Care for America and Democracy for America. MoveOn's advertising plans successfully pressured North Carolina Sen. Kay Hagan to endorse the idea of a public health care plan. No matter. Obama demands that the Left - such as it is - stand down and let Obama do his thing, whatever that is.The president's admonition that progressives focus "on winning this debate" rather than "focusing resources on each other" makes sense only to those operating under the delusion that Obama is in a real fight with corporate healthcare profiteers. In the real world, Obama is in shifting stages of embrace with Healthcare Inc. Debate is permitted only to the Right of his own fuzzy position, while the Left is shushed and hectored.For Obama to "win" his debate, the American people must lose, since overwhelming majorities of the public support single-payer or a Medicare-for-all program, which Obama opposes. Obama has no principled program or irreducible objectives. He cares only that some kind of bill emerges to which he can claim bragging rights. Ideally, Obama would prefer to negotiate the broad outlines of legislation directly with the corporate healthcare profiteers, by assuring them his administration means their bank accounts no harm - a courtship that has been Obama's preoccupation ever since his swearing in.

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Universal Reform Fails - Congress

True national healthcare will fail even with supermajority – American political system structurally flawed.Borosage, prof of law @ American University, Hickey, vice president @ Economic Policy Institute. 2001.Robert and Roger. The Next Agenda: Blueprint for a New Progressive Movement. Pg 100-101. [Mardjuki]

Even if health care recaptures a central spot on the national agenda after the 2000 elections, that is no guarantee that the president and Congress will enact any reform legislation. The assumption that attaining a position on the policy agenda and having public majorities as well as presidential support behind reform will guarantee a political victory has misled reformers time and again. lf those conditions were sufficient to enact national health insurance, such a law would have been passed five decades ago. 'I'he U.S political system creates a number of barriers to the passage of any legislation, let alone a reform as controversial, ideologically divisive, and threatening to powerful interest groups as national health insurance. "The political institutions of American government deliberately fragment power. Unlike a parliamentary system such as that in Great Britain, the U.S. system provides no assurance that the president will represent the same party as the congressional majority. Indeed, divided govemment has become a regular feature of American politics. Moreover, even if the president’s own party enjoys majority status in both houses of Congress. reform will not necessarily follow. Perhaps the most important lesson of American politics for health reform is that partisan majorities do not necessarily pro- duce policy majorities. Compared to parties elsewhere in the world, American political parties are weak. Members of Congress run their own campaigns, raise their own funds, and run independently from—and sometimes in opposition to—their party's platfom. Their first political allegiance is not to their party or president but to their congressional district. Consequently, presidential sponsorship of major legislation, even with a Congress controlled the president': own party, does not ensure presidential victory on any given issue —a lesson Clinton learned the hard way .

Universal reform impossible even with supermajority – fragmented Congress structure.Borosage, prof of law @ American University, Hickey, vice president @ Economic Policy Institute. 2001.Robert and Roger. The Next Agenda: Blueprint for a New Progressive Movement. Pg 100-101. [Mardjuki]

The internal organization of Congress further complicates the road to reform. Legislation must, of course, clear both the House and Senate to reach the president`s desk. But the labyrinth that must be navigated be- fore that step is daunting. Congress is organized into a series of commit- tees and subcommittees that govern various legislative areas. However, substantial overlap exists across committees` iurisdictions; a single bill is often considered by a multitude of committees . ln addition, two key committees—Ways and Means in the House, and the Finance Commit- tee in the Senate——have acted in the past as gatekeepers for health insurance legislation. Failure to get a bill through these committees dooms it to defeat, even if there are congressional maiorities in favor of the legislation (as was the case with Medicare legislation in the early l960s).‘° The fragmented structure of Congress and the relative weakness of American political parties combine to create a roadblock to reform, making it difficult or impossible to achieve the necessary level of consensus on a single piece of legislation. The U.S. legislature, measured in terms of its independence, administrative capacity, and ability to pursue policies that diverge from those sponsored by the executive, is the most powerful lawmaking body in the world. Members of Congress who head committees and subcommittees have their own platforms from which to introduce health care reform bills that differ from the president's or their own parties'. As a consequence, any debate over health reform produces numerous bills sponsored by congressional policymakers seeking to be entrepreneurs. The lesson is a sobering one for reformers. Even if there is a congressional majority in favor of national health insurance, it does not mean there is a majority for any one plan. The inability of congressional majorities to coalesce behind one plan doomed national health legislation during its last two appearances on the national agenda, in 1970 to 1974 and in l993 to 1994.

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Universal Reform Fails – Health Politics

Too many interest groups – true universal healthcare reform impossible.Borosage, prof of law @ American University, Hickey, vice president @ Economic Policy Institute. 2001.Robert and Roger. The Next Agenda: Blueprint for a New Progressive Movement. Pg 101. [Mardjuki]

A second critical barrier to the adoption of national health insurance is the structure of health politics in the United States. Fundamental reform poses a tremendous threat to institutions that are invested in maintaining the medical status quo. This includes a large proportion of American hospitals and physicians, as well as almost all American health insurers, pharmaceutical companies, and suppliers of medical equipment and technology. These groups—what political scientists call “concentrated interests"—have much at stake both financially and organizationally, and are likely to block any reform that threatens to erode their position.2' They are generally well organized, well handed, and willing and able to take advantage of fragmented political institutions and of the media.

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**ECON – STATES**

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2AC AT: Stimulus Solves State Deficits

1. Demand for Medicaid is ballooning as the recession continues – and Obama’s health care reform transfers unfunded federal mandates to the states – that’s Sack and Pear.

2. Stimulus money only covers half of projected 2009 state budgets – insufficient to stem increased state taxes or program cuts – that’s Lav.

3. Stimulus was a temporary fix – massive restructuring necessary to avoid increased Medicaid deficits.Wertheimer, staff writer. 7/22/09.Linda. “Governors bemoan steep slide in state revenues.” National Public Radio. http://www.scpr.org/news/2009/07/20/governors-bemoan-steep-slide-state-revenues/ [Mardjuki]

The recession has hammered the states, causing a 24 percent drop in their revenues nationwide, the NGA says. A large chunk of the shortfall comes from the biggest drop in tax revenue on record. As a result, even with the federal stimulus, the states are facing a wholesale fiscal crisis. "We're projecting shortfalls collectively ... in the next several years of more than $200 billion," says West Virginia Gov. Joe Manchin, a Democrat, who said that figure is "even with the assistance that we receive." The urgency of the problem was underscored by the absence of even the NGA's chairman, Pennsylvania Gov. Edward Rendell, a Democrat, who appeared at the summit via video link because he was preoccupied with the Keystone State's budget woes. Meanwhile, the organization's incoming chairman, Vermont Gov. Jim Douglas, a Republican, says that while the cash infusion from Congress has helped, states face a difficult task in figuring out how to close their yawning budget gaps after the stimulus cash runs out in 2011. "In Vermont, a quarter of our population is on Medicaid , s o (the federal stimulus) was particularly welcome to shore it up over the next couple of years," Douglas said . "But we have to restructure our state governments (and) ... economies so we are ready to get along without these federal resources in a couple of years."

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2AC AT: Kills Econ

1. Plan is an instant stimulus that immediately eases state deficits – only a direct injection of federal money into state budgets can prevent procyclical exacerbation of the economic downturn – that’s Mattoon and Lav.

2. State Medicaid costs are poised to independently devastate state budgets – federal intervention is the only way to stem looming deficits – that’s Olsen.

3. Impact inevitable without reform – Obama’s healthcare bill fails to curb entitlement spending – there’s only a chance that we prevent massive tax increases – that’s Pear.

4. Job loss – Obama’s ineffective healthcare ensures 28 million U.S. jobs will be lost to offshoring – a single-payer system restores U.S. competitiveness – that’s Angell.

5. Federalizing Medicaid would be the ideal second round of stimulus – instantaneous benefits.Drum, senior writer, Yglesias, senior editor of The Atlantic Monthly. 7/11/09. Kevin. “Let the Feds Fund Medicaid?” Mother Jones. http://www.motherjones.com/kevin-drum/2009/07/let-feds-fund-medicaid [JM]

If we need more stimulus, what form should it take?  Matt Yglesias comments: In an ideal world at this point what I’d like to see is more aid to state and local governments. Probably this should just be done in a very crude way — some flat per capita disbursement that could be implemented very rapidly at the federal level and kick specific decisions to someone else. Some of the money would be wasted or used in bad ways, but it wouldn’t be congress or the executive branch doing the wasting, so it’d be someone else’s problem. That kind of thing would work quickly, would be highly stimulative, and would allow structural shifts in the private sector to proceed apace. Well, one quick way to do this might be to stop dinking around with alterations to the Medicaid funding formula (as the first stimulus bill did) and simply turn Medicaid into a purely federal program funded entirely with federal dollars.   This would instantly save states something on the order of $100 billion or so.   Here in California, we'd save a little over $10 billion, which would be $10 billion less in demand-destroying budget cuts we'd have to make.   Eventually this might lead to Medicaid becoming more standardized throughout the country, rather than being a hodgepodge of 50 different plans, but that's probably OK.  I'm not sure Medicaid has really been a great poster child for states as laboratories of democracy anyway.  Maybe it's time to turn the entire program over to the feds so it's not constantly a procyclical drain on the economy and be done with it.

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2AC AT: US Not Key to Global Econ

1. China’s volatile economy is completely dependent on ours – the Chinese financial system will implode as debt and loan structures collapse, leading to widespread unemployment and foreign resentment – that’s Mead.

2. Deep economic recession damages perception of global economic integration and derails Indian political order, opening the door for religious radicalism – that’s Mead.

3. US vital to world economy – deficit, protectionism, and dollar crash would devastate global markets. RADICALLY REVERSE GLOBAL MARKETSFred Bergsten Institute for International Economics 9-9-04 (The Economist, “The risks ahead for the World Economy” Lexis)Five major risks threaten the world economy. Three center on the United States: renewed sharp increases in the current account deficit leading to a crash of the dollar, a budget profile that is out of control, and an outbreak of trade protectionism. A fourth relates to China, which faces a possible hard landing from its recent overheating. The fifth is that oil prices could rise to $60 to $70 per barrel even without a major political or terrorist disruption, and much higher with one Most of these risks reinforce each other. A further oil shock, a dollar collapse, and a soaring American budget deficit would all generate much higher inflation and interest rates. A sharp dollar decline would increase the likelihood of further oil price rises. Larger budget deficits will produce larger American trade deficits, and thus more protectionism and dollar vulnerability. Realization of any one of the five risks could substantially reduce world growth. If two or three, let alone all five, were to occur in combination then they would radically reverse the global outlook.

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Medicaid Costs High Now

States swamped by Medicaid expenses because of a prolonged recession and surge in unemployment.Sack, New York Times senior journalist, two-time Pulitzer Prize winner. 1/21/09.Kevin. “Growing Need for Medicaid Strains States.” New York Times. 2009. http://www.nytimes.com/2009/01/22/us/22medicaid.html [Mardjuki]

Medicaid rolls are surging, by unprecedented rates in some states, as the recession tightens its grip on the econom y and Americans lose their employer-sponsored health coverage along with their jobs. In a number of states, Medicaid populations grew by 5 percent to 10 percent in the last 12 months and, in many, the growth rate was at least double what it had been in the previous year. State Medicaid officials also say that because enrollment often lags behind job losses by several months, the growth in 2008 may represent only the leading edge of heightened demand. In most states, much of the growth in Medicaid has been among children from low-income families, who constitute about half of all recipients. The program also provides coverage for those with disabilities, pregnant women, nursing home residents, and in some instances parents of covered children and childless adults. In a nationwide survey, with 40 states responding, The New York Times found that in some cases the surge in enrollment had overwhelmed social services agencies, and prompted state fiscal analysts to shred estimates that were often only six months old. Here in Gwinnett County, an Atlanta suburb that is home to a growing immigrant population, Medicaid enrollment ballooned by 26 percent from July 2007 to July 2008, according to state officials. One day last fall, the waiting area in the office of the county’s Department of Family and Children Services was so packed with applicants that the fire marshal insisted that another room be opened for overflow. “There’s just been a steady increase in the numbers, and it has followed the economy,” said Glenda G. McMillan, the regional director over the Gwinnett County office. “And there’s no one population. We’re seeing the newly unemployed, the underemployed. There’s just an array of need out there.” But Georgia was hardly alone in seeing substantial jumps in enrollment. Kentucky, which had budgeted last year for increases of 1,000 new Medicaid enrollees per month, has averaged more than triple that since June. In Colorado, which had forecast enrollment growth of about 1 percent for this fiscal year, state officials now project it will be eight times higher. In Florida, which is experiencing some of the fastest Medicaid growth in the country (10.4 percent for the 12 months ending in November), the current caseload is the highest since the program’s creation in 1965, officials there said. Utah officials expect their state’s Medicaid enrollment to grow by 13 percent this year, after declining by 3 percent a year earlier.

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Medicaid Drains State Budgets

Medicaid spending drains state budgets – state legislators attempting to reduce Medicaid spending.Sack, New York Times senior journalist, two-time Pulitzer Prize winner. 1/21/09.Kevin. “Growing Need for Medicaid Strains States.” New York Times. 2009. http://www.nytimes.com/2009/01/22/us/22medicaid.html [Mardjuki]

Eligibility for the income-based program can vary widely by state. But at any one time last year, Medicaid was providing coverage to an average of 50 million people, or about one of every six in the United States . The cost of the program — $333 billion in 2007 — is shared by state and federal governments, with Washington roughly matching the spending approved by the states. The federal government currently picks up about 57 percent of the tab, eating up 7 percent of the federal budget, and the program is one of the largest drains on every state’s budget . As in any economic downturn, the countercyclical program now faces a grim fiscal paradox: by definition, demand for Medicaid coverage is highest precisely when states are least able to afford it because of shrinking tax revenues. Lawmakers returning to state capitals across the country are preparing to negotiate significant reductions in Medicaid spending by freezing or reducing reimbursements to hospitals and physicians, by eliminating coverage options like dental and vision benefits, and by narrowing eligibility for the program.

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Obama HC Drains State Budgets

Health care reform quietly increases state Medicaid financial commitments – devastates state budgets. Tumulty, national political correspondent. 7/21/09.Karen. “Medicaid and the States: Health-Care Reform’s Next Hurdle.” Time Magazine. http://www.time.com/time/politics/article/0,8599,1911856,00.html [JM]

Until the nation's governors staged a public revolt last weekend, few people were paying attention to one of the most far-reaching proposals being considered as part of overhauling the health-care system: a dramatic expansion and redefinition of the Medicaid program. Redefining who is eligible for Medicaid would be one of the major means by which lawmakers hope to achieve universal health coverage — which is one of the reasons that governors, whose budgets are already straining under the program's growing costs, are so wary of the idea. "It depends on what's being proposed," says Pennsylvania's Ed Rendell, a Democrat. "These could essentially be unfunded mandates, and would be enormously destructive to state budgets." The issue came to a boil as the National Governors Association (NGA) met in Biloxi, Miss. At a luncheon with Health and Human Services Secretary Kathleen Sebelius — who until April had been governor of Kansas — her former colleagues vented their anger at the idea of being handed the bill for yet another Washington initiative. Tennessee's Democratic governor, Phil Bredesen, told the New York Times that he regarded the proposed expansion of Medicaid as "the mother of all unfunded mandates" and warned, "Medicaid is a poor vehicle for expanding coverage." (See the top 10 health-care-reform players.) The proposal could hardly come at a worse time for governors. The recession has drained state coffers of tax receipts, even as public need for state safety-net services is growing. According to the Center for Budget and Policy Priorities, at least 48 states are facing shortfalls totaling $166 billion — 24% of their total budgets. Rendell, the outgoing chairman of the NGA, was unable to attend the Biloxi meeting because he had to stay in Pennsylvania and struggle with the legislature to find a way to plug a $3.2 billion fiscal hole. Nor, it seems, could the governors' rebellion have come at a worse time for President Obama's health-care-reform effort, which is being hit from every side by growing doubts.

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Obama HC Drains State Budgets

Medicaid already underwater – Obama’s health care proposals will only drain state budgets further.Sack, New York Times senior journalist, two-time Pulitzer Prize winner, Pear, senior journalist. 7/19/09.Kevin and Robert. “Governors Fear Medicaid Costs in Health Plan.” New York Times. http://www.nytimes.com/2009/07/20/health/policy/20health.html [Mardjuki]

The nation’s governors, Democrats as well as Republicans, voiced deep concern Sunday about the shape of the health care plan emerging from Congress, fearing that Washington was about to hand them expensive new Medicaid obligations without money to pay for them. The role of the states in a restructured health care system dominated the summer meeting of the National Governors Association here this weekend — with bipartisan animosity voiced against the plan during a closed-door luncheon on Saturday and in a private meeting on Sunday with the health and human services secretary, Kathleen Sebelius. “I think the governors would all agree that what we don’t want from the federal government is unfunded mandates,” said Gov. Jim Douglas of Vermont, a Republican, the group’s incoming chairman. “We can’t have the Congress impose requirements that we are forced to absorb beyond our capacity to do so.” The governors’ backlash creates yet another health care headache for the Obama administration, which has tried to recruit state leaders to pressure members of Congress to wrap up their fitful negotiations. Both Ms. Sebelius, who was Kansas’ governor before she joined the cabinet in April, and the federal Medicaid chief, Cindy Mann, made appearances at the meeting on Sunday. Meanwhile, other administration officials spent the day pushing President Obama’s proposal on television talk shows. Mr. Obama also plans to address questions about his health plan at a news conference on Wednesday evening. Ms. Sebelius emerged from her hour-long meeting with the governors saying that “there’s a recognition that states don’t have cash right now” and that “it’s difficult to send states the bill if they don’t have the money.” Although many governors said significant change in how the nation handles health care was needed, they said their deep-seated fiscal troubles made it a terrible time to shift costs to the states. With the recession draining states of tax revenues even as their Medicaid rolls are surging, the National Governors Association projects that states will face aggregate deficits of $200 billion over the next three years . Each of several health care bills coursing through Congress relies on a large increase in eligibility for Medicaid, the state and federal insurance program for the poor, as one means of moving toward universal coverage. Because the states and the federal government share the cost, any increase in eligibility levels, benefits or payments to doctors would impose new burdens on the states unless Washington absorbs them. In at least one of several bills circulating in Congress, the states would eventually pick up a share of the new costs, and the governors fear they cannot count on provisions in other bills that they will not bear costs.

Governors consensus – Obama’s healthcare program will exacerbate state funding shortages.Sack, New York Times senior journalist, two-time Pulitzer Prize winner, Pear, senior journalist. 7/19/09.Kevin and Robert. “Governors Fear Medicaid Costs in Health Plan.” New York Times. http://www.nytimes.com/2009/07/20/health/policy/20health.html [Mardjuki]

It was unclear whether the governors would draft a statement expressing their dismay, at least partly because half of them did not attend. Many, including the group’s chairman, Gov. Edward G. Rendell of Pennsylvania, a Democrat, stayed home to deal with budget crises. Some of the group’s most notable names — Arnold Schwarzenegger of California, Sarah Palin of Alaska, Tim Pawlenty of Minnesota and Bobby Jindal of Louisiana — were not here. But

the sentiment among those who were could not have been more consistent, regardless of political party. The governors said in interviews and public sessions that the bills being drafted in Congress would not do enough to curb the growth in health spending. And they said they were convinced that a major expansion of Medicaid would leave them with heavy costs. They are already anticipating large gaps in Medicaid financing after 2010, when stimulus money dries up. And they pointed out that Medicaid already suffered from low payment rates to health care providers, discouraging some doctors and hospitals from accepting beneficiaries. If Medicaid is expanded, states will almost surely have to increase payments to doctors to encourage more of them to participate. Gov. Phil Bredesen of Tennessee, a Democrat, said he feared Congress was about to bestow “the mother of all unfunded mandates.” “Medicaid is a poor vehicle for expanding coverage,” added Mr. Bredesen, a former health care executive. “It’s a 45-year-old system originally designed for poor women and their children. It’s not health care reform to dump more money into Medicaid.” Mr. Bredesen was far from alone in his concern. “As a governor, my concern is that if we try to cost-shift to the states we’re not going to be in a position to pick up the tab,” said Gov. Christine Gregoire of Washington , also a Democrat. “I’m personally very concerned about the cost issue, particularly the $1 trillion figures being batted around,” said Gov. Bill Richardson, the New Mexico Democrat who served in the Clinton cabinet and ran for president against Mr. Obama.

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Increased costs inevitable – various healthcare bills being debated all increase state medical spending.Sack, New York Times senior journalist, two-time Pulitzer Prize winner, Pear, senior journalist. 7/19/09.Kevin and Robert. “Governors Fear Medicaid Costs in Health Plan.” New York Times. http://www.nytimes.com/2009/07/20/health/policy/20health.html [Mardjuki]

Asked about the concerns, Peter R. Orszag, director of the White House Office of Management and Budget, made two points. First, he said, one of Mr. Obama’s overriding goals was to reduce the rate of growth of health costs, and that would benefit states by relieving pressure on their budgets. In addition, he said, some versions of the legislation, including the House bill, could slightly reduce state spending on Medicaid and the Children’s Health Insurance Program over the next 10 years. Many governors expressed frustration that the prolonged negotiations in Washington had made it difficult to gauge the potential impact on their budgets. “There’s a concern about whether they have fully figured out a revenue stream that would cover the costs, and that if they don’t have all the dollars accounted for it will fall on the states,” said Gov. Bill Ritter Jr. of Colorado, a Democrat. Under the health care proposals before Congress, Medicaid eligibility would be based solely on income, without regard to factors that have historically been used to decide who qualifies. In the House bill, Medicaid would be expanded to cover all nonelderly people with incomes at or below 133 percent of the poverty level, or $29,300 for a family of four. The federal government would pay all the costs for those who were newly eligible. Medicaid would also cover newborns, for up to 60 days after birth, if they did not have insurance from other sources. The Congressional Budget Office projects that 11 million more people would receive coverage through Medicaid under the House bill, and that it would increase federal Medicaid spending by $438 billion over 10 years. Medicaid thus accounts for about 40 percent of the cost and 30 percent of those who gain coverage. In a draft of the bill in the Senate Finance Committee, the federal government would pick up the extra costs for perhaps five years, but states would eventually have to pay their normal share. On average, the federal government pays 57 percent. One of the proposals being considered by the Finance Committee would encourage states to issue bonds to cover the costs of expanding Medicaid. Governors in both parties revolted, trumpeting their opposition in a conference call last week with Senator Max Baucus , the Montana Democrat who leads the committee. “There is strong bipartisan opposition to the idea of the states’ issuing bonds to pay for operational expenses,” said Gov. Haley Barbour of Mississippi, chairman of the Republican Governors Association. “One governor said it would be like taking out a mortgage to pay the grocery bill.”

Only risk that healthcare bill will damage Obama’s cred further – will balloon state deficits.Rove, ex-presidential senior advisor, deputy chief of staff. 7/22/09. Karl. “ObamaCare in Trouble.” Wall Street Journal. http://online.wsj.com/article/SB10001424052970203517304574304161389163586.html?mod=googlenews_wsj [Mardjuki]

Mr. Obama is also slipping on the economy. Those who strongly disapprove now outnumber those who strongly approve of his handling of the economy (35% to 29%), of deficits (38% to 19%), and of unemployment (31% to 26%). On Tuesday, Gallup showed Mr. Obama’s personal approval was 55%, down from more than 60% a few weeks ago and lower than the 56% George W. Bush had at this point in his first term. The polls are crumbling because of a flood of bad news about Mr. Obama’s health-care proposals. One batch of such news came from a July 17 study by the Lewin Group that was commissioned by the Heritage Foundation. It projects that if the House bill becomes law, 83.4 million people—nearly half of those with private coverage—will lose private insurance as employers drop their plans. Mr. Obama’s promise that you can keep your plan is being left on the cutting Another batch of bad news came this week as Democratic governors from Colorado, Tennessee, New Mexico and Washington joined GOP colleagues at the National Governors Association summer meeting to blast the administration for plans to shift millions of families into Medicaid. That could stick states with $440 billion in new costs over the next decade.

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Obama’s healthcare exacerbates states’ Medicare and Medicaid deficits, solidifies private sector insurance.Moore, senatorial aide, law and politics consultant. 7/21/09. Christian. “An Examination of the President’s Health Care Plan.” Manchester Examiner. http://www.examiner.com/x-14783-Law-and-Politics-Examiner~y2009m7d21-An-examination-of-the-presidents-health-care-plan-part-2-of-2 [Mardjuki]

The plan seeks to expand on Medicare and Medicaid. Whatever one thinks about the efficacy and sustainability of these two programs, they themselves are in serious need of reform. They are in no position, in their current state, to handle this type of expansion. I also expect the federal government to place increased mandates on states , even as federal funding is eventually reduced, or fails to keep pace with expanding federal requirements. On the face this will be a serious financial burden to states already facing bankruptcy. My final point relates to some important things the plan does not do. It does nothing to address the current employer based system of health insurance. In fact it solidifies it. Employers provide health insurance as a benefit, and get at least a $5,000 tax credit to do so. The whole concept began during WWII when employers, hamstrung by wartime wage controls, could not offer increased salaries as an incentive to recruit talent. Instead many began offering to take that money and purchase their employees health insurance which until that time was generally purchased privately. Locking citizens into a system of third party payer, employee provided insurance drowning under crushing state converge mandates is a major reason for rising medical costs. I also dislike the idea of being unable to change jobs for fear of losing one’s health insurance coverage. A good bill would address this, not institutionalize it.

Congressional gimmicks – hidden state costs in congressional committees’ HC proposals.Balz, senior writer. 7/19/09.Dan. “At Governors’ Meeting, Budget Problems Are Inescapable.” Washington Post. http://www.washingtonpost.com/wp-dyn/content/article/2009/07/18/AR2009071801786_pf.html [Mardjuki]

But even with the stimulus money, states face collective deficits of more than $200 billion in the next few years. Governors are already talking about the moves they may have to make once the stimulus money disappears after 2011, especially if the economy is not growing at a substantial pace. "We have to restructure our state governments . . . so we are ready to get along without these resources in a couple of years," said Vermont Gov. Jim Douglas (R), who will take over the NGA chairmanship on Monday. As they do that, governors may have another looming fiscal burden. The health-care bills moving through Congress include a significant expansion in Medicaid, which is funded by the federal government and the states. An NGA official estimated that the cost of that expansion could be around $60 billion a year. How might states pay for their share? Maybe not at all, at least for the first few years. One proposal has called for the federal government to pick up permanently the cost for those newly eligible for the program. Another proposal floated earlier was for the federal government to pay the entire bill for five years. But as congressional committees wrestle with projections that show health care turning into a budget buster, they are looking for ways to strip away costs. Governors have already been warned that 100 percent federal financing is now very unlikely. More troubling proposals have been under discussion. Last week, governors revolted against a plan under consideration in the Senate Finance Committee. That proposal, according to an analysis prepared by the Center on Budget and Policy Priorities and shared by Rendell's office, would have called on the states to issue 30-year bonds and pay the cost of the Medicaid expansion from the proceeds. This would have been augmented by some share of promised Medicaid drug rebates. The proposal smelled of an effort to offload some costs of the health-care package during the years that would be included under the Congressional Budget Office's period for "scoring" the budgetary implications of the plan. States were promised relief after 2019. Asking the states to issue bonds for the Medicaid expansion would have taken $180 billion off the budget, according to an estimate by an NGA official. One congressional source described the measure as "subject to gimmick charge." A state official called it "creative financing." Rendell said it was "absolutely" an attempt by the Finance Committee to make the package look less costly during the years included in the CBO scoring window.

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Obama’s healthcare too costly for statesKaren Tumulty, National Political Correspondent for Time Magazine, 7-21-2009, “Medicaid and the States: Health-Care Reform’s Next Hurdle”, http://www.time.com/time/politics/article/0,8599,1911856,00.html

The issue came to a boil as the National Governors Association (NGA) met in Biloxi, Miss. At a luncheon with Health and Human Services Secretary Kathleen Sebelius — who until April had been governor of Kansas — her former colleagues vented their anger at the idea of being handed the bill for yet another Washington initiative . Tennessee's Democratic governor, Phil Bredesen, told the New York Times that he regarded the proposed expansion of Medicaid as "the mother of all unfunded mandates" and warned, "Medicaid is a poor vehicle for expanding coverage." (See the top 10 health-care-reform players.)The proposal could hardly come at a worse time for governors. The recession has drained state coffers of tax receipts, even as public need for state safety-net services is growing. According to the Center for Budget and Policy Priorities, at least 48 states are facing shortfalls totaling $166 billion — 24% of their total budgets. Rendell, the outgoing chairman of the NGA, was unable to attend the Biloxi meeting because he had to stay in Pennsylvania and struggle with the legislature to find a way to plug a $3.2 billion fiscal hole. Nor, it seems, could the governors' rebellion have come at a worse time for President Obama's health-care-reform effort, which is being hit from every side by growing doubts. Douglas Elmendorf, head of the Congressional Budget Office, has testified that the legislation thus far has too little cost containment. Senators of both parties are trying to put the brakes on the President's drive to have bills passed by the House and Senate by the August recess. Republicans are calling it a dangerous "experiment." And even the Mayo Clinic — often cited by Obama as the model of what an efficient, high-quality health-care system should look like — is cautioning on its blog that legislation under consideration in the House "misses the opportunity to help create higher quality , more affordable health care for patients. In fact, it will do the opposite."

Governors wary of unfunded federal healthcare mandates.Steven J. DuBord, staff writer for The New American magazine, 7-22-2009, “Governors, Abortion Stymie Health Reform” http://www.thenewamerican.com/index.php/usnews/health-care/1492

The National Governors Association met on July 18 and 19, including a meeting with Health and Human Services Secretary Kathleen Sebelius and Cindy Mann, the federal Medicaid chief. Both Democratic and Republican governors voiced animosity toward any reform that would overload states at a time when they are already struggling financially. “I think the governors would all agree that what we don’t want from the federal government is unfunded mandates,” said Vermont Governor Jim Douglas (R), the association’s incoming chairman. “We can’t have the Congress impose requirements that we are forced to absorb beyond our capacity to do so. Douglas’ assessment was backed up even by Democratic governors. Tennessee Governor Phil Bredesen, a Democrat, worried that Congress was about to bestow “the mother of all unfunded mandates.” Bredesen, a former executive in healthcare, said that “Medicaid is a poor vehicle for expanding coverage.” Describing it as “a 45-year-old system originally designed for poor women and their children,” he declared, “it’s not health care reform to dump more money into Medicaid.” Democratic Governor Christine Gregoire of Washington is concerned that “if we try to cost-shift to the states we’re not going to be in a position to pick up the tab.” New Mexico Governor Bill Richardson, another Democrat, said, “I’m personally very concerned about the cost issue, particularly the $1 trillion figures being batted around.” And Colorado Governor Bill Ritter, Jr. (D) summed things up: “There’s a concern about whether they have fully figured out a revenue stream that would cover the costs, and that if they don’t have all the dollars accounted for it will fall on the states.”

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Obama HC Drains State Budgets

Governors fear states will pay for Obama’s healthcare.Kevin Sack and Robert Pear, 7-19-2009 (two-time Pulitzer Prize winner and correspondent for the New York Times), “Governors Fear Medicaid Costs in Healthcare” http://www.nytimes.com/2009/07/20/health/policy/20health.html?hp

Although many governors said significant change in how the nation handles health care was needed, they said their deep-seated fiscal troubles made it a terrible time to shift costs to the states. With the recession draining states of tax revenues even as their Medicaid rolls are surging, the National Governors Association projects that states will face aggregate deficits of $200 billion over the next three years. Each of several health care bills coursing through Congress relies on a large increase in eligibility for Medicaid, the state and federal insurance program for the poor, as one means of moving toward universal coverage. Because the states and the federal government share the cost, any increase in eligibility levels, benefits or payments to doctors would impose new burdens on the states unless Washington absorbs them. In at least one of several bills circulating in Congress, the states would eventually pick up a share of the new costs, and the governors fear they cannot count on provisions in other bills that they will not bear costs. It was unclear whether the governors would draft a statement expressing their dismay, at least partly because half of them did not attend. Many, including the group’s chairman, Gov. Edward G. Rendell of Pennsylvania, a Democrat, stayed home to deal with budget crises. Some of the group’s most notable names — Arnold Schwarzenegger of California, Sarah Palin of Alaska, Tim Pawlenty of Minnesota and Bobby Jindal of Louisiana — were not here. But the sentiment among those who were could not have been more consistent, regardless of political party. The governors said in interviews and public sessions that the bills being drafted in Congress would not do enough to curb the growth in health spending. And they said they were convinced that a major expansion of Medicaid would leave them with heavy costs. They are already anticipating large gaps in Medicaid financing after 2010, when stimulus money dries up. And they pointed out that Medicaid already suffered from low payment rates to health care providers, discouraging some doctors and hospitals from accepting beneficiaries. If Medicaid is expanded, states will almost surely have to increase payments to doctors to encourage more of them to participate. Gov. Phil Bredesen of Tennessee, a Democrat, said he feared Congress was about to bestow “the mother of all unfunded mandates.” “Medicaid is a poor vehicle for expanding coverage,” added Mr. Bredesen, a former health care executive. “It’s a 45-year-old system originally designed for poor women and their children. It’s not health care reform to dump more money into Medicaid.” Mr. Bredesen was far from alone in his concern. “As a governor, my concern is that if we try to cost-shift to the states we’re not going to be in a position to pick up the tab,” said Gov. Christine Gregoire of Washington, also a Democrat

House bill encourages states to issue bonds to fund Medicaid.Kevin Sack and Robert Pear, 7-19-2009 (two-time Pulitzer Prize winner and correspondent for the New York Times), “Governors Fear Medicaid Costs in Healthcare” http://www.nytimes.com/2009/07/20/health/policy/20health.html?hp

Many governors expressed frustration that the prolonged negotiations in Washington had made it difficult to gauge the potential impact on their budgets. “There’s a concern about whether they have fully figured out a revenue stream that would cover the costs, and that if they don’t have all the dollars accounted for it will fall on the states,” said Gov. Bill Ritter Jr. of Colorado, a Democrat. Under the health care proposals before Congress, Medicaid eligibility would be based solely on income, without regard to factors that have historically been used to decide who qualifies. In the House bill, Medicaid would be expanded to cover all nonelderly people with incomes at or below 133 percent of the poverty level, or $29,300 for a family of four. The federal government would pay all the costs for those who were newly eligible. Medicaid would also cover newborns, for up to 60 days after birth, if they did not have insurance from other sources. The Congressional Budget Office projects that 11 million more people would receive coverage through Medicaid under the House bill, and that it would increase federal Medicaid spending by $438 billion over 10 years. Medicaid thus accounts for about 40 percent of the cost and 30 percent of those who gain coverage. In a draft of the bill in the Senate Finance Committee, the federal government would pick up the extra costs for perhaps five years, but states would eventually have to pay their normal share. On average, the federal government pays 57 percent. One of the proposals being considered by the Finance Committee would encourage states to issue bonds to cover the costs of expanding Medicaid. Governors in both parties revolted, trumpeting their opposition in a conference call last week with Senator Max Baucus, the Montana Democrat who leads the committee. “There is strong bipartisan opposition to the idea of the states’ issuing bonds to pay for operational expenses,” said Gov. Haley Barbour of Mississippi, chairman of the Republican Governors Association. “One governor said it would be like taking out a mortgage to pay the grocery bill.”

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State Deficits Now – No HC

State deficits now – healthcare is the first to go.Johnson, Director of BPP State Fiscal Project, Phil, Senior Fellow. 6/29/09.Nicholas, Phil. “An Update on State Budget Cuts.” Center on Budget and Policy Priorities. http://www.cbpp.org/cms/index.cfm?fa=view&id=1214. [Mardjuki]

States began cutting their budgets last spring, as the recession brought sharply weakened revenues. The cuts have intensified as the economy has worsened. At least 39 states to date have reduced services since the recession began. Service cuts with particular ramifications for vulnerable populations have occurred in the following areas: Public health programs: At least 21 states have implemented cuts that will restrict low-income children’s or families’ eligibility for health insurance or reduce their access to health care services. For example, Rhode Island eliminated health coverage for 1,000 low-income parents; Minnesota is cancelling a health insurance program for 29,500 low-income adults; and California and Utah are reducing services covered by their Medicaid programs. Programs for the elderly and disabled: At least 22 states plus the District of Columbia are cutting medical, rehabilitative, home care, or other services needed by low-income people who are elderly or have disabilities, or significantly increasing the cost of these services. For example, Florida has frozen reimbursements to nursing homes and relaxed staffing standards, Nevada is making it harder for beneficiaries to qualify for nursing home care, and Rhode Island is requiring low-income elderly people to pay more for adult daycare. Arizona has eliminated temporary health insurance for people with disabilities who are coping with serious medical problems. eliminated temporary health insurance for people with serious medical problems.

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State Deficits Now – No HC

State healthcare being eliminated now – laundry list.Johnson, Director of BPP State Fiscal Project, Phil, Senior Fellow. 6/29/09.Nicholas, Phil. “An Update on State Budget Cuts.” Center on Budget and Policy Priorities. http://www.cbpp.org/cms/index.cfm?fa=view&id=1214. [Mardjuki]

At least 22 states and the District of Columbia have cut medical, rehabilitative, home care, or other services needed by low-income people who are elderly or have disabilities or significantly increased the amounts that such people must pay for services.Alabama has ended homemaker services for approximately 1,100 older adults. These services often allow people to stay in their own homes and avoid nursing home care.Arizona has eliminated temporary health insurance for people with disabilities who are coping with serious medical problems. The state also eliminated general assistance, a program designed to provide time-limited cash assistance to adults with physical or mental disabilities. In addition, in February 2009 the state eliminated independent living supports for 450 elderly residents and respite-care funding for 130 caregivers. It also established a waiting list for vocational rehabilitation services, affecting 2,100 disabled individuals. Furthermore, the state has eliminated early intervention services that support young children with special needs for 850 infants and toddlers at risk of developmental delay.In Florida, nursing homes and other providers will not receive scheduled cost-of-living adjustments in their reimbursements and staffing standards will be relaxed for one year, in the expectation that the freeze will result in staffing cuts. The state also has cut Medicaid reimbursements to hospitals and community-based services for the elderly, such as meals and homemaker services.Georgia has reduced such programs for the elderly as Alzheimer services, elder service centers, prescription drug assistance, and elder support.Louisiana will impose a limit on the number of Medicaid prescriptions it will pay for. This may affect access to prescription drugs for mentally ill or disabled individuals who rely on several medications to manage their conditions.In Massachusetts, the governor has ordered cuts in programs for elders, including home care, geriatric mental health services, and prescription drug assistance.Minnesota has capped enrollment at current levels for a program that provides expanded health services and care coordination for people with disabilities.New Mexico will cut cash assistance payments for low-income disabled residents by a third beginning in July. The state provides these payments to an average of 2,100 disabled individuals each month who cannot work and are not eligible for Temporary Assistance to Needy Families.Ohio plans to close two mental health facilities.In Rhode Island, low-income elderly people must pay higher rates for subsidized adult day care. This is estimated to affect more than 1,200 people with incomes below $20,000.Tennessee has reduced community-based services for people with intellectual disabilities and cut nursing services for some adults with serious disabilities.Vermont has reduced some home-based services, such as housekeeping and shopping, for people who are elderly or disabled. Such services help people stay in their own homes and possibly delay or avoid more expensive nursing home care.Virginia has decreased reimbursements for special hospitals serving people with needs relating to mental health, mental retardation, or substance abuse. The state also reduced pass-through grants for various aging programs and funding for local mental health providers.Other states that have capped or reduced funding for programs that serve people who have disabilities or are elderly includeCalifornia, the District of Columbia, Kansas, Maine, Maryland, Michigan, Pennsylvania, South Carolina, Utah, and Washington.

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State Deficits Now – No Education

State K-12 education cut now – laundry list.Johnson, Director of BPP State Fiscal Project, Phil, Senior Fellow. 6/29/09.Nicholas, Phil. “An Update on State Budget Cuts.” Center on Budget and Policy Priorities. http://www.cbpp.org/cms/index.cfm?fa=view&id=1214. [Mardjuki]

At least 24 states have implemented cuts to K-12 education.Arizona enacted mid-year cuts of $96 per pupil in core K-12 funding. Florida cut aid to local school districts by at least $140 per pupil.South Carolina cut per-pupil funding by $95 this past year. California is reducing basic K-12 education aid to local school districts. It also is cutting a variety of other programs, such as adult literacy instruction, and is reducing funding for some grants and programs aimed at helping high-needs students.Georgia made a $112 million cut to the equalization component of the state’s education aid formula established to help close the gap in funding between wealthier and poorer school districts.Maryland cut funding for a school breakfast pilot program, professional development for principals and educators, health clinics, gifted and talented summer centers, and math and science initiatives.Massachusetts enacted cuts to Head Start, universal pre-kindergarten programs, and early intervention services to help special-needs children develop appropriately and be ready for school. The state also cut K-12 funding, including spending for mentoring, teacher training, reimbursements for special education residential schools, services for disabled students, and programs for gifted and talented students.In Nevada, the governor has ordered various cuts to K-12 education, including delaying an all-day kindergarten expansion, cutting per pupil expenditures by $400 in a pilot program, eliminating funds for gifted and talented programs and a magnet program for students who are deaf or hard of hearing, and making across-the-board cuts. Additionally, young children with developmental delays will lose more than 15,000 hours of needed services.Rhode Island has frozen state aid for K-12 education at last year’s levels in nominal terms and reduced the number of children who can be served by Head Start and similar services by more than 550.State education grants to school districts have also been cut in Alabama, Connecticut, Delaware, Hawaii, Idaho, Iowa, Kansas, Kentucky, Maine, Mississippi, Ohio, Oregon, Utah, Washington, and Virginia.

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State Deficits Now – No Education

State higher education budgets cut now – laundry list.Johnson, Director of BPP State Fiscal Project, Phil, Senior Fellow. 6/29/09.Nicholas, Phil. “An Update on State Budget Cuts.” Center on Budget and Policy Priorities. http://www.cbpp.org/cms/index.cfm?fa=view&id=1214. [Mardjuki]

At least 32 states have implemented cuts to public colleges and universities and/or made large increases in college tuition to make up for insufficient state funding.Arizona State University has addressed its loss of state funds by eliminating over 550 staff positions and 200 faculty associate positions, imposing employee furloughs ranging from 10 to 15 days, consolidating several schools and almost two dozen academic departments, and limiting enrollment in its nursing school. Tuition in Arizona this year rose 9.5 percent in response to funding cuts.As a direct result of state budget cuts, the California State University system is cutting enrollment by 10,000 students. The University of California system is reducing California resident freshman enrollment by 2,300 students for next year.Florida has cut university budgets and community college funding. The University of Florida has announced it will eliminate 150 positions for the coming year, resulting in 49 staff and nine faculty layoffs. Florida State University plans to lay off up to 200 faculty and staff members. Tuition at all 11 Florida public universities will rise by 15 percent next year.At the State University of New York, resident undergraduate tuition increased by 14 percent (over $600 per year) between the fall and spring semester of this past academic year.When Rhode Island cut higher education funding, the University of Rhode Island, Rhode Island College, and the Community College of Rhode Island all increased tuition for this past academic year. Each of these institutions went one step further by increasing tuition further mid-year, by 6.7 percent, 8.2 percent, and 4.3 percent respectively.Budget cuts reduced state funding for the University of Washington by 26 percent for the coming biennium. The budget authorizes the university to increase tuition up to 14 percent to compensate for this funding loss.Other states cutting higher education operating funding include Alabama, California, Colorado, Connecticut, Georgia, Hawaii, Idaho, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Minnesota, Mississippi, New Jersey, Nevada , New Mexico, North Carolina, Oklahoma, Pennsylvania, South Carolina, Tennessee, Utah, Vermont, and Virginia.

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State Deficits Now – Job Loss

State employees being fired now – laundry list.Johnson, Director of BPP State Fiscal Project, Phil, Senior Fellow. 6/29/09.Nicholas, Phil. “An Update on State Budget Cuts.” Center on Budget and Policy Priorities. http://www.cbpp.org/cms/index.cfm?fa=view&id=1214. [Mardjuki]

At least 40 states plus the District of Columbia are eliminating or not filling various state jobs, imposing mandatory furloughs (time off without pay), or making other cuts affecting their state workforce. Such steps can make it more difficult for residents to obtain state services. Cutting staff — whether on a permanent or temporary basis — also may contribute to increased unemployment.A number of states are imposing furloughs and/or pay cuts for some state employees. These include Arizona,California, Georgia, Hawaii,Idaho, Iowa, Kentucky, Maryland, Massachusetts, Michigan, New Jersey, New Mexico, Nevada, Ohio, North Carolina, South Carolina, and Utah.To deal with budget cuts in Kentucky, the Department of Public Advocacy (which defends clients in the criminal justice system) instituted a strict hiring freeze, gave early retirement to 25 employees, and furloughed remaining employees.New Jersey has eliminated 2,000 state positions by encouraging early retirement, leaving vacancies unfilled, and laying off staff.The Ohio governor has announced plans to eliminate as many as 2,700 positions, about 4.5 percent of the state workforce, through a combination of early retirements, layoffs, and leaving vacancies unfilled. In the Department of Jobs and Family Services — which oversees disability services, child care, child support, health care, child welfare, and other services — fully 14 percent of positions will be eliminated or left unfilled. Overall, the Ohio state workforce declined by 3,000 between March 2007 and December 2008.Rhode Island plans to reduce the state workforce by 2,000 or more. The state is encouraging early retirement but has announced that it will lay off workers if needed.The Tennessee governor has announced elimination of over 2,000 state positions, about 5 percent of the state workforce. Some 1,500 employees accepted buy-outs for early retirement.In Washington, a hiring freeze imposed by the governor in August caused the state’s workforce to decline by more than 1,400. In early January the state replaced the freeze with a cap on the number of budgeted positions at each state agency; the state’s workforce is expected to fall by another 2,600 under the cap.Virginia’s governor has eliminated 800 currently unfilled positions, laid off 567 state workers, and delayed a 2 percent salary increase scheduled for November 2008.Hiring freezes have also been ordered in Alabama, Arizona, California, Colorado, Connecticut,Delaware, the District of Columbia, Florida, Georgia,Hawaii, Iowa, Kansas, Louisiana, Maine, Michigan,Minnesota, Mississippi, New Hampshire, New Mexico, New York, North Carolina, Pennsylvania, South Dakota, Vermont, Wisconsin, and Wyoming.Additional states — such as Arizona, Florida, Illinois, Maine, Massachusetts, Michigan, andSouth Carolina, plus the District of Columbia — have laid off or announced plans to lay off state employees. As noted above, a number of state colleges and universities in states such as Alabama, Arizona, Florida, Kentucky, and New Jersey are responding to budget cuts by cutting faculty and staff positions.

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States Deficit Now—Tradeoffs

Medicaid tradeoffs with social services in state budgets –Ohio proves.Jordan Cravens, staff writer, 7-21-2009, “State Budget Cuts to Affect Social Services”, http://www.morningjournal.com/articles/2009/07/21/news/mj1361976.txt

Social service agencies in Lorain County are feeling the rippling effects of Ohio's newly passed budget.Services will be slashed and the lines for those in need of assistance will likely be longer, according to directors of two of the county's service boards. "We got killed in the budget," said Charles Neff, executive director of the Lorain County Board of Mental Health. While the figures are yet to be ironed out, Neff said the board is expecting between $1 million and $2 million less from the state. "This is going to mean drastic cuts," Neff said, noting the department already took a $975,000 budget hit in 2009. "We felt like we were unfairly targeted in 2009," and again, we were short-sided in the 2010 budget, he said. Elaine Georgas, executive director of the Alcohol and Drug Addiction Services Board of Lorain County, said her department is also preparing to get hit with a financial crunch. "We have heard that our state department (Ohio Department of Alcohol and Drug Addiction Services) has been given a 30 percent budget cut," which will likely work its way down to the county level, Georgas said. She is expecting anywhere from $300,000 to $400,000 in cuts. "I know the state's issue is with Medicaid," Georgas said, but roughly 75 percent of the board's clients are not on Medicaid, she said. "They rely on the state funding for services," Georgas said. "These cuts will definitely be a problem for these clients." But now, with preference being given to those with Medicaid, Georgas said other clients will likely have to wait longer for services. Neff said he foresees the same issue arising — people without Medicaid getting bumped to the back of the line. "It's going to impact people who don't have Medicaid," he said. Both Neff and Georgas agreed the impact on the criminal justice system will furthering the ripple effect. “The criminal system will probably grow," Georgas said. The way Neff has it figured is for every $1 spent on mental health, the government could save $11 in keeping citizens out of the court system and prisons. Children's services, families and communities will all bare the burden of the cuts, Georgas said. "Families are going to suffer because people who need treatment need to get treatment as soon as they can," Georgas said. The Alcohol and Drug Addiction Services Board seeks to minimize substance abuse and work toward prevention by contracting out with agencies who can provide treatment, Georgas explained. The Board of Mental Health treats clients suffering from depression, schizophrenia and other mental health issues by contracting out with 18 different agencies as well as psychiatric hospitals to provide service to county residents, according to Neff. He said the board would do its best to maintain its core client services but the cuts would surely impact residential treatment, mentoring services throughout the county and youth services.

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State Deficits Now—Tradeoffs

California budget cuts reduce other social servicesJennifer Steinhauer, New York Times L.A. bureau chief, 7-15-2009, “California Approaches a Deal on Budget Cuts”, http://www.nytimes.com/2009/07/16/us/16calif.html?hp

Democrats, who control the Legislature and who had worked to prevent what they called a gutting of the state’s social services, appeared to be prevailing in some measure by agreeing to cuts to other programs and localities. The deal also required the use of accounting devices used by all states in a time of crisis, like putting off programs or payments until the next fiscal year so the budget gap does not seem as large. Mr. Schwarzenegger, a Republican, held fast to his promise to reject all tax increases, and appeared on the brink of victory in achieving many — if not all — of the reforms he sought for some programs. Those who work as caregivers in the state’s $4.7 billion home health care program, for example, will most likely face more stringent screening processes intended to curb fraud, like fingerprinting and background checks. While the state’s health care program for poor uninsured children will not end, as the governor once threatened, its enrollment will probably be limited, state officials said, meaning that some children will be on a waiting list for health care. Medicaid recipients will probably be moved into a managed-care program. Further Medicaid cuts seem unlikely, as they would put the state in violation of federal standards. Benefits will also be trimmed in another program the governor eyed for elimination — CalWorks, which provides financial assistance to families with children ages 18 and under. The state’s education budget of nearly $52 billion seemed destined for another large hit, of about $1.5 billion, on top of large reductions earlier, officials said. Some school districts have already promised raises to teachers, leaving them even less able to continue to offer programs like music and physical education. Public colleges and universities across the state have prepared for millions of dollars in cutbacks by furloughing employees. Statewide furloughs of three days a month for government employees are likely to continue through the rest of the fiscal year. Local governments, which have already suffered their own losses of tax revenues, will probably lose far more as a result of the deal when the state begins dipping into tax streams on which they depend, including gasoline taxes. Cities can try to borrow the amount they are losing, and the agreement in progress calls for the state to repay them over three years, but many of the financially weaker localities may face the prospect of defaulting on their bonds.

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State Deficits Now –Tradeoffs

California budget crisis hurting social services and schools Jennifer Steinhauer, New York Times L.A. bureau chief, 7-20-2009, “California Reaches Budget Deal, With Billions Cut”, http://www.nytimes.com/2009/07/21/us/21calif.html?_r=1

California lawmakers, their state broke and its credit rating shot, finally sealed the deal with the governor Monday night on a plan to close a $26 billion budget gap. The plan, which is certain to be viewed with trepidation among legislatures across the country also facing huge budget gaps, distributes pain through nearly every aspect of government services. While the Legislature pushed back on Gov. Arnold Schwarzenegger’s proposal to eliminate health care programs for children and the state’s generous welfare program, both took large cuts. So did public education, universities and local governments.All told, the deal contains $15.6 billion in cuts, about $2.1 billion in borrowing, $3.9 billion in new revenues and about $2.7 billion in accounting maneuvers like shifting a payday into the next fiscal year, which Mr. Schwarzenegger had claimed he would not brook. Under the new budget, which runs through the 2010 fiscal year, localities will basically serve as unwilling lending agents to the state. It will raid their coffers and repay them over time as the state’s fiscal situation improves. “I would characterize this budget as shared pain and shared sacrifice,” Karen Bass, the speaker of the California Assembly, said in a telephone interview from Sacramento. Last February, lawmakers signed off on a budget deal with $14.8 billion in spending cuts, $12.5 billion in tax increases and $5.4 billion in new borrowing, along with the creation of a $1 billion reserve fund. But that budget depended on a nod from voters on several ballot measures. All failed.With the deficit continuing to grow, the state was forced to issue millions of dollars in i.o.u.’s to vendors and taxpayers in lieu of payment. After weeks of often-cantankerous negotiations, state officials have come up with a compromise that few who receive government services will celebrate. While the state’s health insurance program for children, Healthy Families, remains, it was cut by $144 million, meaning thousands of children will probably be on a waiting list for the program unless a private foundation makes up the balance, as the Democratic-controlled Legislature hopes. In-home services for the elderly and infirm were reduced by several million dollars, and Mr. Schwarzenegger, a Republican, achieved his goal of having caregivers and the recipients fingerprinted in the future with the goal of preventing fraud. While the governor wanted certain welfare benefits to be reduced from a five-year period to two years, the program was instead given an overall cut of $500 million. Local governments will lose millions of dollars that are used to build housing, among other purposes, and the state plans to borrow roughly $2 billion in property taxes from localities, which would have to be repaid within three years. Lawmakers believe that cities and counties could in turn borrow against that borrowing; localities bankrupt or nearly so would be exempt. One of the biggest sticking points was over the $11 billion already cut from public schools. The budget deal calls for roughly $650 million more in cuts.

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State Deficits Tank Econ

Federal economic action ineffective without rectifying state deficit problems.Krugman, prof of economics and international affairs @ Princeton. 7/22/09.Paul. “Fifty Herbert Hoovers.” New York Times. http://www.nytimes.com/2008/12/29/opinion/29krugman.html?_r=1&ref=opinion&pagewanted=print [Mardjuki]

No modern American president would repeat the fiscal mistake of 1932, in which the federal government tried to balance its budget in the face of a severe recession. The Obama administration will put deficit concerns on hold while it fights the economic crisis. But even as Washington tries to rescue the economy, the nation will be reeling from the actions of 50 Herbert Hoovers — state governors who are slashing spending in a time of recession, often at the expense both of their most vulnerable constituents and of the nation’s economic future. These state-level cutbacks range from small acts of cruelty to giant acts of panic — from cuts in South Carolina’s juvenile justice program, which will force young offenders out of group homes and into prison, to the decision by a committee that manages California state spending to halt all construction outlays for six months. Now, state governors aren’t stupid (not all of them, anyway). They’re cutting back because they have to — because they’re caught in a fiscal trap. But let’s step back for a moment and contemplate just how crazy it is, from a national point of view, to be cutting public services and public investment right now. Think about it: is America — not state governments, but the nation as a whole — less able to afford help to troubled teens, medical care for families, or repairs to decaying roads and bridges than it was one or two years ago? Of course not. Our capacity hasn’t been diminished; our workers haven’t lost their skills; our technological know-how is intact. Why can’t we keep doing good things? It’s true that the economy is currently shrinking. But that’s the result of a slump in private spending. It makes no sense to add to the problem by cutting public spending, too. In fact, the true cost of government programs, especially public investment, is much lower now than in more prosperous times. When the economy is booming, public investment competes with the private sector for scarce resources — for skilled construction workers, for capital. But right now many of the workers employed on infrastructure projects would otherwise be unemployed, and the money borrowed to pay for these projects would otherwise sit idle. And shredding the social safety net at a moment when many more Americans need help isn’t just cruel. It adds to the sense of insecurity that is one important factor driving the economy down . So why are we doing this to ourselves? The answer, of course, is that state and local government revenues are plunging along with the economy — and unlike the federal government, lower-level governments can’t borrow their way through the crisis. Partly that’s because these governments, unlike the feds, are subject to balanced-budget rules. But even if they weren’t, running temporary deficits would be difficult. Investors, driven by fear, are refusing to buy anything except federal debt, and those states that can borrow at all are being forced to pay punitive interest rates.

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State Deficits Tank Econ

State deficits have a domino effect – have widespread negative economic impacts.Johnson, Director of BPP State Fiscal Project, Phil, Senior Fellow. 6/29/09.Nicholas, Phil. “An Update on State Budget Cuts.” Center on Budget and Policy Priorities. http://www.cbpp.org/cms/index.cfm?fa=view&id=1214. [Mardjuki]

With tax revenue declining as a result of the recession and budget reserves largely drained, more than three-fourths of states are making spending cuts that hurt families and reduce necessary services. These cuts, in turn, will make the recession worse because families and businesses have less to spend in their local economies. Federal recovery act dollars and funds raised from tax increases are greatly reducing the extent, severity, and economic impact of these cuts, but only to a point. Many cuts — including those hurting vulnerable families — will take effect July 1, 2009, the first day of the new fiscal year in most states, or soon after. For example, dental and vision services for many Medicaid recipients in California and Michigan will be eliminated. Hundreds of thousands of people with disabilities in those states and in New Mexico will experience cuts in aid. Reimburse-ment rates for some health care providers and human services agencies will decline July 1 in Minnesota, Utah, Washington, and Wyoming. In coming months, public university tuition will rise at double-digit percentage rates in Florida, Washington, and elsewhere — and school districts will absorb cuts in state aid. The cuts enacted in at least 39 states are occurring in all major areas of state services, including health care (21 states), services to the elderly and disabled (22 states), K-12 education (24 states), higher education (32 states), and other areas. States are making these cuts because the recession has caused declining revenues from income taxes, sales taxes, and other revenue sources used to pay for these services. At the same time, the need for these services has not declined and has, in fact, risen as the number of families facing economic difficulties increases. And these figures do not include the proposed cuts that many states still are discussing. As of June 25, some 18 states had not enacted budgets for the upcoming fiscal year. Many of those states, including Arizona, Illinois, Massachusetts, New Jersey, and North Carolina, are almost certain to enact further cuts.

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State Deficits Tank Econ

State deficits prolong recession – hinder increased economic activity.Johnson, Director of BPP State Fiscal Project, Phil, Senior Fellow. 6/29/09.Nicholas, Phil. “An Update on State Budget Cuts.” Center on Budget and Policy Priorities. http://www.cbpp.org/cms/index.cfm?fa=view&id=1214. [Mardjuki]

Cuts to state services not only harm vulnerable residents but also worsen the recession by reducing overall economic activity. When states cut spending, they lay off employees, cancel contracts with vendors, reduce payments to businesses and nonprofits that provide services, and cut benefit payments to individuals. All of these steps remove demand from the economy. For instance, at least 41 states have reduced overall wages paid to state workers, by laying off workers, requiring them to take unpaid leave (furloughs), freezing new hires, or similar actions. Such measures not only can reduce the level or quality of service available to state residents, but also reduce the purchasing power of workers’ families, which in turn affects local businesses. States are taking actions to mitigate the extent of these cuts. Most states are enacting or considering tax increases. At least 24 states in 2009 are addressing their budget shortfalls in part by increasing taxes. Like budget cuts, tax increases remove demand from the economy, by reducing the amount of money people have to spend. But tax increases can be less detrimental to state economies than budget cuts because some of the tax increases affect upper-income households so are likely to result in reduced saving rather than reduced consumption. Many more states will need to consider tax increases or other revenue measures, as well as such steps as tapping state rainy day funds, as a way to minimize harmful budget cuts.

Cuts to state programs reduce overall economic activity.CBPP. 7/23/09.“New Fiscal Year Brings Continued Trouble for States Due to Economic Downturn.” Policy Points, Center on Budget and Policy Priorities. http://www.cbpp.org/cms/index.cfm?fa=view&id=1283 [Mardjuki]

The weak economy continues to cause great fiscal distress among states as they begin a new fiscal year (July 1 marked the start of 2010 for most states). Combined budget gaps for the next two years are estimated to total more than $350 billion. The American Recovery and Reinvestment Act includes roughly $140 billion in fiscal relief for state governments, enough to close 30 to 40 percent of state shortfalls. States are using these funds to help balance their budgets while minimizing harmful cuts in public services. Although the recovery package is mitigating states’ fiscal problems, states are continuing to cut services like education and health care as they enact 2010 budgets. To date at least 39 states have addressed their shortfalls by reducing services to their residents, including some of their most vulnerable families and individuals. Cuts to state services not only harm vulnerable residents but also worsen the recession by reducing overall economic activity . Some thirty states have enacted tax increases this year in response to budget shortfalls caused by the recession, and several more are considering them.. Like budget cuts, tax increases remove demand from the economy, by reducing the amount of money people have to spend. But tax increases can be better for state economies than budget cuts because some of the tax increases result in reduced saving rather than reduced consumption. Forty-eight states faced or are facing budget shortfalls. • At least 48 states addressed or are facing shortfalls in their budgets for the new fiscal year totaling $163 billion or 24 percent of state budgets. This includes $24 billion in shortfalls that have opened in 12 states in just the few weeks since they passed their 2010 budgets. All of those states had already taken major steps to balance their budgets and the new gaps will require further action during the year to restore balance. • At least 33 states have prepared estimates for the 2011 fiscal year. Initial estimates of these shortfalls total almost $51 billion. As the full extent of 2011 deficits become known, shortfalls are likely to equal $160 to $180 billion. These shortfalls come on top of $111 billion in 2009 gaps that states closed through a combination of spending cuts, withdrawals from reserves, revenue increases, or use of federal stimulus dollars. Combined budget gaps for the remainder of this fiscal year and state fiscal years 2010 and 2011 are estimated to total over $350 billion. States are using fiscal relief to balance their budgets.

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More Stimulus Needed - Unemployment

Stimulus wasn’t enough – skyrocketing unemployment.Fletcher, staff writer. 7/22/09.Michael. “Obama: Health Care Reform Is Essential to Rebuilding Economy.” Washington Post. http://voices.washingtonpost.com/44/2009/07/22/a_news_conference_to_push_hard.html?wprss=44 [Mardjuki]

Undercutting Obama's effort also is growing public discontent about his handling of the overall economy. With the nation just beginning to emerge from the most severe economic downturn since the Great Depression, unemployment is continuing to rise. It now stands at 9.5 percent and is projected to surge even higher in the coming months, despite the $787 billion economic stimulus plan that Obama managed to squeeze through Congress in the early weeks of his administration. Many economists agree that the employment picture would be much worse had the stimulus plan not been enacted. Still, the administration missed badly when it projected that unemployment would not rise above 8 percent with the measure in place, hurting the credibility of its economic forecasts. The worsening unemployment picture is expected to slow future economic growth and push projected government budget deficits even higher, creating new obstacles for the proposed sweeping health care overhaul.

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More Stimulus Needed - Insufficient

January stimulus has failed – limited impact – second round needed.Boskin, professor of econ @ Stanford, senior fellow @ Hoover Institution, chairman of Council of Economic advisors. 7/22/09.Michael. “Obama Needs a Move to the Middle.” Wall Street Journal. http://online.wsj.com/article/SB10001424052970203946904574302332578189864.html?mod=googlenews_wsj#printMode [Mardjuki]

While strong recoveries sometimes follow deep recessions, historically recoveries following financial crises have been slow and painful. The specter of massive future tax hikes and inflation is worsening the outlook. We need a better, more coherent policy path back to a strong market economy—not to a European style social-welfare state, permanent government lifelines and stagflation. The last time we had a comparable economic crisis—the double-digit inflation, 20% interest rates, near 11% unemployment, and even larger inflation-adjusted stock market decline of the late 1970s and early ’80s—a new policy path was charted consisting of low tax rates, sound money, slower spending growth, free trade and less intrusive regulation. Those policies pulled us out of stagflation and led to a quarter-century of growth. Moving so far in the exact opposite direction invites eventual disaster for American workers and firms. Half a year and two million lost jobs since the stimulus bill was passed, less than 10% of the funds have been disbursed and what has been been saved, not spent, by consumers. Out of the $320 billion increase in personal disposable income, some from the increased transfer payments in the stimulus bill, personal consumption outlays have risen only $1 billion. That’s far short of President Barack Obama’s promised “immediate” help. Nor has there been the promised “multiplier” on every stimulus dollar spent. Infrastructure spending in the pipeline will likely deliver more than this, but a lot less than advertised. Score the stimulus a very expensive, tragically wasted opportunity. Pressure is building from the left for a second stimulus program .

First round of stimulus insufficient.Browne, financial analyst and former British Parliament member. 7/26/09.John. “What Stimulus?” Pittsburgh Tribune. http://www.pittsburghlive.com/x/pittsburghtrib/opinion/s_635198.html [Mardjuki]

It is becoming painfully apparent that the Obama administration's stimulus package has failed to halt the deepening recession. There is now growing pressure for a second, even larger, stimulus. But many Americans fear things are getting out of control, all to the inevitable long-term damage of the U.S. economy. What should the government do? As expensive and undesirable as it was to bail out the very "casino" banks which had precipitated a financial meltdown, a majority of politicians probably would agree that it was in the national and, arguably, global interest. The current stimulus is not the first but actually the second package. Both the stimulus packages of President Bush and President Obama could be attacked for being too little too late. As early as the summer of 2006, some private observers predicted the economic recession of 2008. With its privileged access to national statistics and confidential core data, the administration and the Fed should have predicted the downturn. It is accepted that, after more than a year of contraction, the U.S. economy slipped into recession in December 2007. The Fed was both late and slow in lowering its key interest rate from its August 2007 level of 5.25 percent. Likewise, the Bush administration, maintaining that the economy was healthy, was more than a year late with its stimulus package. In addition, when measured against the aggregate erosion of household wealth, estimated at some $10 trillion, the first $750 billion package was woefully inadequate. (To be fair, it was targeted at tax rebates and, therefore, quickly disseminated.) While President Obama's stimulus package was organized early in his administration, it also was far too small.

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More Stimulus Needed - Statistics

First round of stimulus insufficient – recent unemployment and state deficit statistics prove.Kuttner, founder of The America Report, senior fellow @ Demo Think Thank. 7/5/09.Robert. “Three Reasons We Need an Economic Wake Up Call.” Huffington Post. http://www.huffingtonpost.com/robert-kuttner/3-reasons-we-need-an-econ_b_225962.html [Mardjuki]

Several events of the past week should be a wake-up call to the Obama administration. Bottom line: the medicine isn't working. Stronger stuff is needed. Consider: The green-shoots school was expecting that the rising rate of unemployment would continue to slow, as it did in May. But instead the number spiked back up. A total of 467,000 jobs were lost. The unemployment rate rose to 9.5 percent, and OECD economists project that U.S. unemployment will still be in double digits as late as 2011. The 9.5 percent official figure -- the worst since 1983 -- conceals even worse news. The number of long-term unemployed is at record levels. This is the only recession since the Great Depression in which the job loss wiped out all the job growth of the previous recovery. As our friends at the Economic Policy Institute report. We now have fewer jobs than in May 2000 when the recovery began, though the economy now has 12.5 million more workers. And there is less than one job opening for every five people seeking jobs. Hidden unemployment is also setting records - people with part time work who want full time work, as well as people whose hours have been involuntarily cut. Until strong economic growth returns, companies will not resume hiring. And as long as layoffs continue, that means fewer customers and the downward spiral continues. As EPI observes, President Obama's economic stimulus simply wasn't designed for a recession this deep. And I would add that stimulus funds are getting out too slowly. Compounding the problem is inadequate government policy on three crucial fronts: The states, unlike the Federal government, are not permitted to run current budget deficits. So in a deep recession, when tax receipts fall, their only choice is to cut program spending or raise taxes. Both are of course perverse in a recession, since they only further undercut consumer purchasing power. As the new fiscal year begins, nearly every state is raising taxes or fees, or laying off workers and reducing programs. At least 48 states face red ink. Some of the state budget crisis is self-inflicted, as in the dance to the death between California Governor Arnold Schwarzenegger and Democrats in the legislature, compounded by a two-thirds supermajority requirement for any kind of tax reform. But most states are just plain hurting. Massachusetts, with one of the most liberal governors, Deval Patrick, just hiked its sales taxes by 25 percent. A total of 24 other states have enacted tax increases and another 12 all have tax hikes on their agendas. Federal aid under the stimulus covers just 30 to 40 percent of the state shortfall, which is expected to total $350 billion by 2011. And 39 states have cut program outlays on the needy, according to the Center on Budget and Policy Priorities. The New York Times reports that several states are cutting out summer school.

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More Stimulus Needed – States Key

Federal aid to states needed to avoid prolonged recession.Mattoon, senior economist and economic advisor @ Chicago Federal Reserve. August 2009.Richard. “Should the Federal Government Bail Out the States? Lessons from Past Recessions.” Chicago Federal Reserve Bank Essay Number 265. http://www.chicagofed.org/publications/fedletter/cflaugust2009_265.pdf [Mardjuki]

Like the economy in general, individual state economies are struggling in this recession. State governments face significant constraints in raising additional revenues. Most states are required to balance their budgets regardless of the economic environment. This article considers the role of the federal government in helping the states to manage their finances. State government budget woes have been much in the news. Recently, California projected a $21 billion deficit after failing to get voter approval for a series of budget balancing fiscal measures.1 In January of this year, five prominent Democratic governors suggested that the federal government should commit $1 trillion in aid to the states over the next two years.2 The rationale for such financial support is that states (which are generally prohibited from running deficits) need the money to maintain key programs, such as Medicaid, unemployment insurance, and work force training, for which demand rises during a recession. Also, this aid might help states avoid enacting spending cuts or tax increases that could deepen or prolong the economic downturn.

Most effective stimulus is federal funding to balance state budgets.Mattoon, senior economist and economic advisor @ Chicago Federal Reserve. August 2009.Richard. “Should the Federal Government Bail Out the States? Lessons from Past Recessions.” Chicago Federal Reserve Bank Essay Number 265. http://www.chicagofed.org/publications/fedletter/cflaugust2009_265.pdf [Mardjuki]

Most of the federal government’s aid to counteract the effects of the 1973–75 and 2001 recessions had very few restrictions. As such, it was easy for a state to substitute federal money for own-source revenues. Whether federal money should be unrestricted or targeted depends largely on the purpose behind the federal relief funds. If the goal is to stabilize spending across the state government sector, unrestricted aid from the federal government that can be used as a state sees fi t is appropriate. Unrestricted aid can also be spent faster, and the speed of getting money into the economy is often a goal of this aid. If, however, the federal government hopes to support specific types of state programs, such as Medicaid or education, categorical aid increases the accountability for the spending. Further, the federal government can provide the money on a matching funds basis that requires the state to maintain its contribution to the specific program and not allow it to simply withdraw state funding and replace it with federal dollars. How the federal government finances the aid package must also be considered . For an aid package to be truly stimulative, the federal government needs to borrow the funds and the states need to use the money to either expand spending or avoid tax increases . It would also be feasible for the federal government to borrow the funds but have the states use the money to retire debt. While this would improve the states’ balance sheets, it would not stimulate growth in the state government sector. The least optimal funding strategy would be for the federal government to reduce its expenditures or raise taxes to fund aid to the states and then for the states to use the money to retire debt. In this case, the government sector would actually contract.

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More Stimulus Needed – States Key

Stimulus aid unsustainable – increased assistance for state recovery needed.Mattoon, senior economist and economic advisor at Chicago Fed. July 2009.Richard. “Asessing the State and Local Sector – Where Will the Money Come From? A Conference Summary.” Chicago Federal Reserve Essay 264b. http://www.chicagofed.org/publications/fedletter/cfljuly2009_264b.pdf [Mardjuki]

Donald Boyd, Rockefeller Institute of Government, outlined the structure of the American Recovery and Reinvestment Act of 2009 (ARRA). The act provides $787 billion in total aid, with $250 billion going to state and local governments by specifi c category. By design, $130 billion will provide immediate fiscal relief, especially for Medicaid and education. Current estimates from the Congressional Budget Office show that the bulk of the stimulus money will be spent in the first three federal fiscal years (FYs) of the program—$47.4 billion in 2009, $96.9 billion in 2010, and $50.6 billion in 2011. According to Boyd, while the stimulus money is certainly welcomed, the longer term picture for state (and local) governments looks challenging. Under differing scenarios based on the behavior of state tax revenues in previous recessions, Boyd argued that it may take more than five years for these revenues to fully recover. In one scenario, states as a group would still face potential budget gaps of greater than $100 billion (6%) when the stimulus money is exhausted. An Illinois perspective was provided by Ginger Ostro, director of the Governor’s Office of Management and Budget. Ostro noted that with no policy changes Illinois is facing an $11.6 billion deficit in FY2010. Revenues are expected to fall $2.5 billion in FY2009 and continue falling in FY2010. Receipt of the ARRA money will certainly help, but it is not sufficient to preclude a combination of spending cuts and tax increases to close the budget gap.

States need more money for budgets even after the stimulus James Surowiecki , staff writer for The New Yorker, 7-26-2009, “Fifty Ways to Kill Recovery” http://www.newyorker.com/talk/financial/2009/07/27/090727ta_talk_surowiecki

It’s easy enough, of course, to mock state governments nowadays, what with California issuing I.O.U.s to pay its bills and New York’s statehouse becoming the site of palace coups and senatorial sit-ins. But the real problem isn’t the fecklessness of local politicians. It’s the ordinary way in which state governments go about their business. Think about the $787-billion federal stimulus package. It’s built on the idea that during serious economic downturns the government can use spending increases and tax cuts to counteract the effects of consumers who are cutting back on spending and businesses that are cutting back on investment. So fiscal policy at the national level is countercyclical: as the economy shrinks, government expands. At the state level, though, the opposite is happening. Nearly every state government is required to balance its budget. When times are bad, jobs vanish, sales plummet, investment declines, and tax revenues fall precipitously—in New York, for instance, state revenues in April and May were down thirty-six per cent from a year earlier. So states have to raise taxes or cut spending, or both, and that’s precisely what they’re doing: states from New Jersey to Oregon have raised taxes in the past year, while significant budget cuts have become routine and are likely to get only deeper in the year ahead. The states’ fiscal policy, then, is procyclical: it’s amplifying the effects of the downturn, instead of mitigating them. Even as the federal government is pouring money into the economy, state governments are effectively taking it out. It’s a push-me, pull-you approach to fighting the recession.Now, state cutbacks have not been as severe as they might have been, thanks to the stimulus plan , which includes roughly $140 billion in aid to local governments. That aid, according to a recent study by the Center on Budget and Policy Priorities, has covered thirty to forty per cent of the states’ budget shortfalls. Money for the states translates directly into jobs not lost and services not cut—which is why you can make a good case that more of the stimulus should have gone to state aid. Yet there’s no sign that those budget gaps are getting smaller, and, as the federal money runs out, state tax increases and spending cutbacks are only going to become more common. In the midst of this downturn, some of the biggest players in the economy—state and local governments together account for about thirteen per cent of G.D.P.—will be doing precisely the wrong thing.

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More Stimulus Needed – States Key

More stimulus needed – aid to states and easing health care deficit key.Zandi, chief economist @ Moody’s Investor Services and Risk Analysis. 7/11/09.Mark. “Do We Need Another Stimulus?” Washington Post. http://www.washingtonpost.com/wp-dyn/content/article/2009/07/11/AR2009071100292.html [Mardjuki]

Planning now for another round of stimulus is prudent, though, given that the economy remains in an extraordinarily severe downturn and the risks are decidedly to the downside. If additional stimulus is needed, then it probably should include more aid to hard-pressed state governments, whose budget woes are intensifying, more aid to stressed households hammered by what will be double-digit unemployment, an expansion of the housing tax credit to stem the ongoing slide in house prices, a delay in legislated increases in marginal personal tax rates in 2011, and perhaps even a payroll tax holiday. Policymakers could smooth the way for all this if they were able to demonstrate this summer they are serious about addressing the nation's darkening long-term fiscal outlook by credibly paying for health-care reform.

States’ procyclical fiscal policy hampering recovery efforts – federal government should go directly to state aid.Suroweicki, staff writer. 7/27/09. James. “Fifty Ways To Kill Recovery.” New Yorker. http://www.newyorker.com/talk/financial/2009/07/27/090727ta_talk_surowiecki [JM]

If you came up with a list of obstacles to economic recovery in this country, it would include all the usual suspects—our still weak banking system, falling house prices, overindebted consumers, cautious companies. But here are fifty culprits you might not have thought of: the states. Federalism, often described as one of the great strengths of the American system, has become a serious impediment to reversing the downturn. It’s easy enough, of course, to mock state governments nowadays, what with California issuing I.O.U.s to pay its bills and New York’s statehouse becoming the site of palace coups and senatorial sit-ins. But the real problem isn’t the fecklessness of local politicians. It’s the ordinary way in which state governments go about their business. Think about the $787-billion federal stimulus package. It’s built on the idea that during serious economic downturns the government can use spending increases and tax cuts to counteract the effects of consumers who are cutting back on spending and businesses that are cutting back on investment. So fiscal policy at the national level is countercyclical: as the economy shrinks, government expands. At the state level, though, the opposite is happening. Nearly every state government is required to balance its budget. When times are bad, jobs vanish, sales plummet, investment declines, and tax revenues fall precipitously—in New York, for instance, state revenues in April and May were down thirty-six per cent from a year earlier. So states have to raise taxes or cut spending, or both, and that’s precisely what they’re doing: states from New Jersey to Oregon have raised taxes in the past year, while significant budget cuts have become routine and are likely to get only deeper in the year ahead. The states’ fiscal policy, then, is procyclical: it’s amplifying the effects of the downturn, instead of mitigating them . Even as the federal government is pouring money into the economy, state governments are effectively taking it out. It’s a push-me, pull-you approach to fighting the recession. Now, state cutbacks have not been as severe as they might have been, thanks to the stimulus plan, which includes roughly $140 billion in aid to local governments. That aid, according to a recent study by the Center on Budget and Policy Priorities, has covered thirty to forty per cent of the states’ budget shortfalls. Money for the states translates directly into jobs not lost and services not cut—which is why you can make a good case that more of the stimulus should have gone to state aid . Yet there’s no sign that those budget gaps are getting smaller, and, as the federal money runs out, state tax increases and spending cutbacks are only going to become more common. In the midst of this downturn, some of the biggest players in the economy— state and local governments together account for about thirteen per cent of G.D.P. — will be doing precisely the wrong thing.

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More Stimulus Needed – States Key

Federal assistance crucial to stem negative pro-cyclical economic state action.Lav, Gold award for contribution to state fiscal policy, state budget and tax expert, McNichol, state budget and tax senior fellow. 6/29/09.Iris and Elizabeth. “State Budget Troubles Worsen.” Center on Budget and Policy Priorities. http://www.cbpp.org/cms/index.cfm?fa=view&id=711 [Mardjuki]

The current situation has been made more difficult because many states never fully recovered from the fiscal crisis of the early part of the decade. This heightens the potential impact on public services of the shortfalls states now are projecting. State spending fell sharply relative to the economy during the 2001 recession, and for all states combined it still remains below the fiscal year 2001 level. In 18 states, general fund spending for fiscal year 2008 — six years into the economic recovery — remained below pre-recession levels as a share of the gross domestic product. In a number of states the reductions made during the downturn in education, higher education, health coverage, and child care remain in effect. These important public services were suffering even as states turned to budget cuts to close the new budget gaps. Spending as a share of the economy declined in fiscal year 2008 and is projected to decline further in 2009 and again in 2010. One way states can avoid making deep reductions in services during a recession is to build up rainy day funds and other reserves. At the end of fiscal year 2006, state reserves — general fund balances and rainy day funds — totaled 11.5 percent of annual state spending. Reserves can be particularly important to help states adjust in the early months of a fiscal crisis, but generally are not sufficient to avert the need for substantial budget cuts or tax increases. In this recession, states have already drawn down much of their available reserves; the available reserves in states with deficits are likely to be depleted in the near future. Federal assistance Crucial. Federal assistance can lessen the extent to which states need to take pro-cyclical actions that can further harm the economy. The American Recovery and Reinvestment Act recognizes this fact and includes substantial assistance for states. The amount in ARRA to help states maintain current activities is about $135 billion to $140 billion — or less than half of projected state shortfalls. Most of this money is in the form of increased Medicaid funding and a “Fiscal Stabilization Fund.” This money has reduced to a degree the depth of state spending cuts and moderated state tax and fee increases. There are also other streams of funding in the economic recovery act flowing through states to local governments or individuals, but this will not address state budget shortfalls.

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A2: ARRA Stimulus Solves Medicaid Deficits

Governor consensus – unfunded federal mandates tank state economies that are surviving on stimulus cash infusions.Trygstad, staff writer. 7/21/09Kyle. “Governors Warn Congress on Health Care Efforts.” Real Clear Politics. http://www.realclearpolitics.com/politics_nation/2009/07/governors_warn_congress_on_hea.html [Mardjuki]

The nation's governors have sent a letter to Congress urging them not to impose "unfunded federal mandates and reforms that simply shift costs to states" as they consider health care reform. A House proposal would provide permanent funding for Medicaid expansions, which the governors support. Writing on behalf of the National Governors Association, chairman Jim Douglas (R) of Vermont says: Any unfunded expansions would be particularly troubling given that states face budget shortfalls of over $200 billion over the next three years. This gap persists even after the Recovery Act's temporary increases in the federal share of Medicaid, which was essential for avoiding dramatic cuts to critical state services and was greatly appreciated by governors. Governors welcome the opportunity to share and expand upon the innovative reforms we have instituted in our states to expand coverage, reduce cost and improve the quality of health care. These reforms should inform congressional efforts and must be preserved and encouraged as part of any national reform. We appreciate your willingness to work with us to pursue financing options that are sustainable at both the federal and state levels. Obama relied on the support of governors, particularly Republicans like Douglas and Florida's Charlie Crist, to sell his stimulus plan. Health and Human Services Secretary Kathleen Sebelius, the former Kansas governor, was dispatched to this weekend's NGA conference to hear the state executives' concerns.

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Trickle Up Stimulus Needed

The economy will not recover without a trickle up policy- unemployment, tax appeals, forclosuresRandall Wray, 7-7– Senior Scholar and professor of economics and director of the Center for Full Employment and Price Stability at the University of Missouri Economic Perspectives from Kansas City, “The Carnage Continues: Time to Ramp Up the Stimulus” July 7, 2009, http://neweconomicperspectives.blogspot.com/2009/07/carnage-continues-time-to-ramp-up.html)

Some like to see green shoots everywhere, but that is becoming an increasingly audacious hope . Here are four related stories from the July 5th edition of the New York Times:Tax Bill Appeals Take Rising Toll on Governments By Jack Healy Homeowners across the country are challenging their property tax bills in droves as the value of their homes drop, threatening local governments with another big drain on their budgets…. The tax appeals and reassessments present a new budget nightmare for governments . In a survey conducted by the National Association of Counties, 76 percent of large counties said that falling property tax revenue was significantly affecting their budgets…. Officials in some states say their property tax revenue is falling for the first time since World War II . Safety Net Is Fraying for the Very Poor By Erik Eckholm Government "safety net" programs like Social Security and food stamps have pulled growing numbers of Americans out of poverty since the mid-1990s. But even before the current recession, these programs were providing less help to the most desperately poor , mainly nonworking families with children… The recession is expected to raise poverty rates , economists agree, although the impact is being softened by the federal stimulus package adopted this year…. "It's a good thing we have the stimulus package," Mr. {Arloc} Sherman said. "But what happens to the most vulnerable families in two years, when most of the provisions expire?" Employment Report Sours the Market By Jeff SommerA grim report on unemployment on Thursday let the air out of the stock market…. In a monthly report, the Labor Department said that 467,000 jobs were lost in June. In surveys, most economists expected 100,000 fewer jobs lost. The unemployment rate edged up to 9.5 percent from 9.4 percent the previous month, to its highest level in 26 years, and virtually all analysts expect joblessness to mount in the coming months . So Many Foreclosures, So Little Logic By Gretchen Morgenson LAST week, the stock market tumbled on news that housing foreclosures and delinquencies rose again in the first quarter . The Office of the Comptroller of the Currency said that among the 34 million loans it tracks, foreclosures in progress rose 22 percent, to 844,389. That figure was 73 percent higher than in the same period last year.... But the most fascinating, and frightening, figures in the data detail how much money is lost when foreclosed homes are sold. In June, the data show almost 32,000 liquidation sales; the average loss on those was 64.7 percent of the original loan balance. What do these reports have in common? They provide powerful evidence that the federal government is not doing enough to help the "real" economy. As Sam Gompers famously responded when asked what workers wanted--"More!"—our nation's state and local governments, households, workers, and poor need more help, now. We have tried the Reagan/Paulson/Rubin/Geithner "trickle down" approach of targeting relief to Wall Street, but the only thing trickling down is misery. The only way to stop the downward spiral is to substitute trickle-up policy—and even if nothing trickles-up, at least we will have helped those most in need.

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Fed Action Key

Interstate issues dealt with more effectively at the federal level.Suroweicki, staff writer. 7/27/09. James. “Fifty Ways To Kill Recovery.” New Yorker. http://www.newyorker.com/talk/financial/2009/07/27/090727ta_talk_surowiecki [JM]

Even more important, federalism is getting in the way of the creation of a “smart” American power grid. This would involve turning the current hodgepodge of regional and state grids into a genuinely national grid, which would detect and respond to problems as they happen, giving users more information about and control over their electricity use, and so on. It could also dramatically reduce our dependence on oil. Wind power could eventually produce as much as twenty per cent of the energy that America consumes. The problem is that the places where most of that wind power can be generated tend to be a long way from the places where most of that power would be consumed. A new grid would enable us to get the power to where it’s needed. But since nobody likes power lines running through his property, building the grid would require overriding or placating the states—and the prospects of that aren’t great. The tension between state and national interests isn’t new: it dates back to clashes in the early Republic over programs for “internal improvements.” Of course, the federal government is far bigger than it once was, and yet in the past two decades we’ve delegated more authority, not less, to the states. The logic of this was clear: people who are closer to a problem often know better how to deal with it. But matters of a truly interstate nature, like the power grid, can’t be dealt with on a state-by-state basis. And fiscal policy is undermined if the federal government is doing one thing and the states are doing another. It’s a global economy. It would be helpful to have a genuinely national government.

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Federalize Medicaid Solves State Budgets

Federalization of Medicaid solves dysfunctional state bureaucracies and relieve waterlogged state budgets.Klein, editor, economic and domestic policy expert. 7/14/09.Ezra. “A Win For Medicaid.” Washington Post. http://voices.washingtonpost.com/ezra-klein/2009/07/a_win_for_medicaid.html [JM]

Greg Anrig, vice president of policy at the Century Foundation, writes in with a very good point on the House health-care bill: It opens the door to eventually federalizing the Medicaid program, which would be a huge step forward: One encouraging element of the health care reform bill released today by three House committees is that it would finance expanded eligibility for Medicaid entirely with federal money. Since its inception in 1965, Medicaid’s financing has been shared jointly between the feds and state governments. That arrangement has much to do with Medicaid’s huge shortcomings: wide state-to-state variations in eligibility rules and benefit levels, chronic under-funding, and limited medical options for beneficiaries. Because the program primarily covers adults and individuals with low incomes, along with nursing home residents, it has never benefited from broad political support. The House bill would not require state contributions to pay for expanding Medicaid eligibility to 133 percent of the federal poverty level because, the committees correctly note, state budgets are already overwhelmed due to the recession. But a potential long-term payoff to this reform would be to open the door to federalizing the program entirely down the road. Federally run insurance programs like Social Security and Medicare are vastly more efficient and effective than federal-state counterparts like Medicaid and unemployment insurance. Economies of scale, uniform national rules, and the inability of 50 state governments to each do mischief to the programs have demonstrably led to far superior results for national social insurance. If some new Medicaid beneficiaries have their benefits entirely paid for by the feds, it’s conceivable that other categories -- such as those eligible for both Medicare and Medicaid -- could be similarly shifted entirely to federal funding in later reforms. That would create opportunities for the federal government to exert greater control over the largely dysfunctional program, perhaps ultimately folding it into the proposed public health plan. In the process, step by step, the fragmentation that contributes so much to the flaws in our health care system would begin to wither away. On a related note, a lot of people have been arguing for a third stimulus focused on state budgets and services. One way to do that would be to simply federalize Medicaid funding. It would be good long-term policy, good short-term politics, and a huge relief for state budgets.

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Medicaid Reform Solves State Budgets

Only massive Medicaid reform solves the state budget crisis Olsen, senior reporter. 6/20/09.Dean. “Medicaid reform tied to state budget crisis.” State Journal-Register. http://www.sj-r.com/homepage/x488806173/Medicaid-reform-tied-to-state-budget-crisis [JM]

Regardless of how much money would be saved this year or next, reform of Illinois’ Medicaid program — or at least firm plans to make changes in the system — appears to be a key component of any resolution to the state budget crisis . Republicans in the Democrat-controlled Illinois Senate and House have all but required that long-term Medicaid reform be part of any budget discussions. Republican votes may be crucial to reduce the impact of the state’s $9 billion deficit through a potential income tax increase. According to the most optimistic estimates, Medicaid reforms could save a total of $983 million over the next two years, and more in future years. Republicans say that without changes, the rising cost of Medicaid will take up more and more state resources and “crowd out” other state services while further delaying payments to Medicaid providers. “It is the 700-pound gorilla quickly turning into the 900-pound gorilla,” state Sen. Dale Righter, R-Mattoon, said last week. “We want to make as much positive change as possible.” Many Republicans also believe there is too much waste in the system and that some people don’t deserve state-provided health care that was made available to more children and parents under former Gov. Rod Blagojevich. But there is disagreement — and outright fear — about the potential ramifications for patients, hospitals and doctors when it comes to changes in state health programs that cover 2.5 million Illinoisans and cost $12 billion a year in state and federal funds. Howard Peters, senior vice president of the Naperville-based Illinois Hospital Association, said Republican fervor for Medicaid reforms appears to be fueled by “the dilemma of raising taxes.” “People are almost desperately looking for some kind of ‘silver bullet’ that can get us out of this thing that can be painless,” he said. “I’m not sure there is a clear-enough concept of the consequences of these proposals.” Medicaid spending has grown an average of almost 8 percent per year between 2003 and 2008, more than twice the rate of inflation, according to a recent report by Gov. Pat Quinn’s Taxpayer Action Board. The report, which is available   online at http://tinyurl.com/taxpayerboard , says that if costs continue to grow at that rate Medicaid spending will reach $22 billion in 2019 and could represent 50 percent of the state budget. “ It should be obvious to everyone that if you’re concerned about anything in the budget, you need to be concerned about Medicaid,” Righter said. He is one of four Republican lawmakers who began meeting privately Friday with four of their Democratic counterparts in the General Assembly and a representative of Quinn to discuss ideas for Medicaid reform. Consensus wasn’t reached on any issues after the two-hour meeting in Chicago, but the group will meet again Tuesday or Wednesday in Springfield, said Michael Gelder, Quinn’s chief health-policy adviser.

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Medicaid Reform Solves State Budgets

Medicaid reform needed to stabilize state budgets and local economies – current system unsustainable.Klein, senior editor, economic and domestic policy expert. 6/19/09.Ezra. “Guest Graph: The Future of Medicaid.” Washington Post. http://voices.washingtonpost.com/ezra-klein/2009/06/guest_graph_the_future_of_medi.html [JM]

Harold Pollack is an associate professor of public health at the University of Chicago. He's one of the smartest social policy thinkers I know, and this piece he sent in, arguing that it's time we recognized the centrality of Medicaid and made it a federal program rather than a state partnership, is right on the money. My inbox this morning includes a white paper comparing different versions of the public health insurance plan, links to competing webcasts on value-based insurance design, malpractice reform, comparative effectiveness research, the tax treatment of employer-provided health plans, and more. It’s impossible to keep up. Amid this health policy tumult, one basic issue receives less attention than it deserves: The precarious condition of Medicaid, our essential but flawed state-federal partnership that finances medical care and related services for almost 50 million people. Charting a sustainable future for Medicaid is essential for virtually every aspect of health reform, and for the fiscal survival of state governments. Slapped together 45 years ago as a relatively small program that mainly financed healthcare to welfare recipients and their children, Medicaid has evolved into a huge and diverse program that finances almost half of American nursing home and long-term care, bears large responsibilities for the care of disabled adults and children, and is the major vehicle to cover millions of poor and near-poor Americans who would otherwise be uninsured. Figure 1 shows why state policymakers are panicking. It shows inflation-adjusted medical expenditures by state and local governments between 1960 and 2007. (These data are drawn from National Health Expenditure data, adjusted for the CPI and expressed in year-2007 dollars. The spreadsheets can be accessed here.) As state and local medical expenditures cross the $300 billion mark, the existing framework no longer works. Rising Medicaid expenditures undermine states’ ability to address other pressing needs. Saddled with balanced-budget requirements and constrained tax bases, dozens of states are cutting or constraining services at precisely the moment when these services are most needed to meet human needs and to stabilize local economies. The cuts seem most dramatic in California . Yet painful measures are being taken in many other states. What can be done? First, we must recognize that the budget challenge is more than a nasty episode brought on by the current downturn. States’ Medicaid problems have been building for decades. In truth, states have cut financial corners for decades, underpaying providers, delaying payment, failing to operate these programs with the skill and humanity that patients deserve. The worst is yet to come. Actuaries predict that state Medicaid expenditures will roughly double by 2017 . I should be more careful here. Rhetoric about soaring Medicaid costs is actually misplaced. As a percentage of GDP, past and projected increases in state expenditures are modest, barely exceeding 1% of GDP. They are dwarfed by corresponding changes in Medicare.

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Single Payer Solves State Deficits

Plan would save billions in single states aloneAucoin 94Don Aucoin, writer for the Boston Globe, “Roosevelt blasted for ties to Bulger; CAMPAIGN 94 ROUNDUP” lexis-nexis[LO//AS]

Democratic gubernatorial candidate George Bachrach, a supporter of a single-payer health system, yesterday endorsed a bid to pass ballot questions in favor of such a health plan. "There is a yearning in this state for single payer," Bachrach said during a news conference outside the State House. Bachrach said his state-run single-payer health plan would contain health care costs and yield savings of $ 4 billion currently being allocated to "wasteful administrative costs" and insurance company profits. He said the savings would help provide coverage to the state's estimated 600,000 people who lack health insurance. Bachrach's plan was endorsed by the Massachusetts chapter of Physicians for a National Health Program . The candidate backed an effort led by a grass-roots organization called Neighbor to Neighbor, to be launched tomorrow, to place nonbinding, single-payer questions on the ballot in seven state senate districts and one state representative district across the state.

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Kentucky – Medicaid Chopping Block

Kentucky on the brink – Medicaid funding already on the chopping block, stimulus money will sunset by 2010.Musgrave, staff writer. 7/21/09Beth. “State plugs budget hole with Medicaid money.” Lexington Herald-Leader. http://www.kentucky.com/news/state/story/868712.html [Mardjuki]

The state was in the black for the fiscal year that ended June 30, but only because it received a loan from the Medicaid program, which had additional money from the federal stimulus program. Now state officials are trying to determine how much money state agencies will have to cut from this year's budget, which began July 1. For the fiscal year that just ended, the state was $55.7 million short in General Fund dollars and nearly $37 million short in Road Fund money — which pays for transportation projects. To balance the General Fund shortfall — which funds the bulk of state government — Kentucky used unspent General Fund money that was allocated to its Medicaid program. Medicaid, an insurance program for the poor and the disabled, is paid with federal and state dollars. In general, the state picks up about 30 percent of the tab and the federal government pays 70 percent. However, the federal government retroactively increased its share of Medicaid dollars this year to nearly 80 percent of the cost. That means the state had additional state money in that program that could be used to cover the shortfall, said Mary Lassiter, the state budget director. Moving money from Medicaid to the General Fund will not affect the Medicaid program. It is fully funded for the coming fiscal year, Lassiter said. But some people in the social-services sector questioned whether it was wise to borrow money from a program that is likely to need those dollars in the future. Steve Shannon, director of the Kentucky Association of Regional Mental Health- Mental Retardation Programs, which represents community mental health centers, said the increase in the federal share of the Medicaid program is supposed to sunset in December 2010. Yet the number of people eligible for Medicaid will probably remain the same while the state's portion of the bill will increase, Shannon said. "Then what are we going to do?" he said. "Where do we find money to plug that shortfall?" The shortfall in the state's Road Fund was plugged using savings from restructuring debt and other cost-cutting measures such as restricting travel and cutting other expenses at the Transportation Cabinet, Lassiter said. "We're not cutting any projects," Lassiter said of saving measures at the Transportation Cabinet. The state had to balance its books from the last fiscal year before it could determine how how much to cut from this year's budget. If the state had to use money set aside for this year's budget, there could have been additional cuts in programs, Lassiter said. Gov. Steve Beshear had originally proposed plugging a potential $1 billion shortfall for this fiscal year with $741 million in federal stimulus dollars and a 2.6 percent cut to most state agencies, with a few exceptions. The exceptions included the state Medicaid programs and the main funding formula for K-12 education. But in a special legislative session in June, the General Assembly approved a budget-reduction plan that included $45 million in spending that was not in Beshear's original proposal. Some of that $45 million included an income-tax credit for active-duty military personnel and an increase in the budgets for public defenders and prosecutors. Legislators also approved a tax credit of as much as $25 million for people who buy newly built homes. The additional spending means that the cuts to agencies are likely to be deeper than 2.6 percent, Beshear has said. Over the past 18 months, state agencies have cut more than $600 million as the state repeatedly adjusted its budget to account for falling revenues. "This is the fifth budget reduction in 19 months," Lassiter said. Lassiter said Monday that the state has asked all agencies to show how a 3 percent and a 4 percent cut would effect the delivery of services. Those plans are due this week. The agency proposals will be reviewed and discussed with Beshear, Lassiter said. But it probably will be several weeks before agencies are told how much to cut.

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Louisiana – Medicaid Deficit

Louisiana set to run into a $1 billion Medicaid shortfall – drop in federal funding and miscalculated budget.Louisiana Governor’s Office. 7/22/09.“Insurance, Federal Payouts Create Medicaid Problem in Louisiana.” Associated Press. http://www.claimsjournal.com/news/southcentral/2009/07/22/102426.htm?print=1 [Mardjuki]

Louisiana Gov. Bobby Jindal says post-storm damage payments from insurance settlements and Louisiana's Road Home program following Hurricanes Katrina and Rita are contributing to a $1 billion Medicaid shortfall for his state . Jindall's office says he is trying to work out a solution with federal officials over the looming crisis. Medicaid, which serves the poor and uninsured, calculates payment schedules to the states based on per-capita income. That figure goes far beyond wages and salaries - including all payments from all sources. Louisiana's impending dramatic decrease in federal funding is due to what the governor says is a faulty calculation of sources of income in the state, including insurance and Road Home payments after the 2005 storms. From 2005 to 2007, according to the Bureau of Economic Analysis, Louisiana's per-capita income is reported to have increased by 42 percent - a dramatic, sudden increase which will drop the state's federal Medicaid funding, according to the governor's office. Jindal says Louisiana's reimbursement rate will drop from as high as 73 percent to 60 percent - forcing cuts to either public health or higher education. Within the next year, Louisiana will face the largest decrease of federal Medicaid funding in the nation - a decrease almost twice that of the state with the next largest decrease, North Dakota, the governor's office said. Louisiana's Medicaid funding, which would normally be 72 percent, is temporarily enhanced by the federal stimulus. This coming October, it will decrease to 67 percent, and then will decrease to 63 percent in October 2010. The drop from 72 to 63 percent will cost the state an estimated $700 million per year. The state will start seeing this loss of funding this October, with the full impact starting January 2011.

Predicted billion-dollar Medicaid deficit will devastate Louisiana economy.ABC News. 7/22/09.“Our Views: Medicaid rate hits Louisiana.” WBRZ News 2, Louisiana. http://www.2theadvocate.com/opinion/51360777.html [Mardjuki]

If this year’s state budget crisis was fun, wait until next year. Because of the formula used in the calculation of Medicaid support from the federal government, Louisiana might face significant new budget cuts in the 2011 fiscal year that begins next July 1. And then, in 2011, not only does Medicaid reimbursement take another dive, but the federal stimulus aid to the state also goes away — a double-whammy. Gov. Bobby Jindal and U.S. Sen. Mary Landrieu, D-La., recently met on the problem. We hope Landrieu and the state’s delegation in Congress can plot a way through this thicket. Because Louisiana is a relatively poor state, the federal reimbursement for Medicaid — the principal medical program for the poor — is in the range of 70 percent of the cost of the care. That rate is determined by a formula based on total personal income in the state, as calculated by the independent Bureau of Economic Analysis. The problem? Louisiana’s income was artificially inflated by insurance payments and federal aid in the wake of the hurricanes of 2005. If the reimbursement rate is adjusted for that bogus “income,” Louisiana faces a shortfall in the hundreds of millions of dollars per year. “The people of Louisiana have been devastated by four major storms in just over three years and they’re fighting to get back on their feet, and should not be victimized again by their own government,” Jindal said. “This formula will put severe pressure on health-care funding, higher-education funding and other key Louisiana priorities.” Jindal’s top health aide, Alan Levine, has been to Washington to press the state’s case for relief. We hope that the Obama administration and Congress listen, but the state’s case for assistance is clouded by political concerns. Overall, there is the problem of “Katrina fatigue,” with the state’s woes after the hurricanes receding in national consciousness. Further, there are ballooning federal budget deficits — for which Jindal is trying to score political points by criticizing President Barack Obama. Aid to Louisiana on this front will add to the deficit; members of Congress might be reluctant to make even this one change because the nonpolitical formula should be preserved against future raids. We don’t agree with the latter position, because of the hugely exceptional circumstances of the 2005 hurricanes, but it is an argument that is going to be heard. Finally, the state government is going hat-in-hand to the U.S. government for more than $700 million in Medicaid funds.

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**ECON – FEDERAL DEF**

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Consumer Confidence Low Now

Consumer confidence is tanking the economy Michael A. Kamperman runs his own investment advisory firm, Prometheus Wealth Management. He earned a Master's Degree in Business Administration from Baylor on June 30, 2009 (“Falling Consumer Confidence Foreshadows Worsening Jobs Outlook” http://www.escapethenewgreatdepression.com/2009/06/30/falling-consumer-confidence-foreshadows-worsening-jobs-outlook/

The Consumer Confidence Index fell in June to a reading of 49.3 from a reading of 54.8 in May. The green-shoot crowd expected confidence to continue rising. Based on an increase in the value of the stock markets and the constant press coverage for green-shoots and an improving economic picture, the decline in confidence in June has come as a cold slapped in the face to those looking for an imminent rebound in the economy . What I found ominous in the report was the consumer outlook for employment. The Conference Board stated “the job outlook was also more pessimistic. Those anticipating more jobs in the months ahead decreased to 17.4 percent from 19.3 percent, while those anticipating fewer jobs increased to 27.3 percent from 25.6 percent.” If this survey is accurate, then the unemployment rate reported for June could approach 10%. The survey is a measure of attitudes and feelings. The news coverage in May and June has been positive. The retrenchment in consumer sentiment can only be traced to further deterioration in the real economy. The drop is especially significant since people receiving a paycheck had fewer payroll related taxes withheld from their checks. Access to credit remains as tight as ever for both consumers and businesses. The credit markets remain broken. The economy is made up of spending based on access to cash. Access to cash can come from savings, income, or credit. As long as credit remains extremely tight the economy has to rely on savings and income. But with unemployment rising and unemployment benefits starting to run out for those that lost their jobs last summer and fall, incomes are not in a position to pick up the slack for access to credit. That leaves savings. The rational response to a deteriorating economy even for those with access to credit is to save more. Plus, if one cannot qualify for a mortgage or auto loan one does not spend what savings they have for a downpayment. Washington has gone on a wait and watch approach to the economy. This week they could get well get a wakeup call when the unemployment data is released. They may seek to demean the data for the unemployment rate and call it once again a lagging indicator. Fine, but weekly unemployment claims are not a lagging indicator. The weekly number has to begin to improve before the unemployment rate can improve. When the economy improves employers first slow down their rate of layoffs. Then employers have their existing workforce work longer hours. Finally employers hire and the unemployment rate begins to go down. The weekly claims number released this week will be part of the July unemployment report. If that number is above 600,000 again, then we will know the July unemployment report will also be weak. The credit markets and the economy will not heal on their own in the near term. Only meaningful intervention from Washington will fix the credit markets within the next few years.

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**ECON IMPACTS**

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Lashout ! Scenario

A) Growth is critical to preventing ineffective forms of intervention that risk nuclear holocaust and wars.Foster, Ph.D professor @ University of Oregon, 09(John Bellamy Foster, Ph.D professor @ University of Oregon, March 2009, “A Failed System: The World Crisis of Capitalist Globalization and its Impact,” Monthly Review; 60.10; Wilson Social Sciences Abstracts)

As the foregoing indicates, the world is currently facing the threat of a new world deflation-depression, worse than anything seen since the 1930s. The ecological problem has reached a level that the entire planet as we know it is now threatened. Neoliberal capitalism appears to be at an end, along with what some have called "neoliberalism 'with Chinese characteristics.'''54 Declining U.S. hegemony, coupled with current U.S. attempts militarily to restore its global hegemony through the so called War on Terror, threaten wider wars and nuclear holocausts. The one common denominator accounting for all of these crises is the current phase of global monopoly~financed capital . The fault lines are most obvious in terms of the peril to the planet. As Evo Morales, president of Bolivia, has recently stated: "Under capitalism we are not human beings but consumers. Under capitalism mother earth does not exist, instead there are raw materials." In reality, "the earth is much more important than [the] stock exchanges of Wall Street and the world. [yet,] while the United States and the European Union allocate 4,100 billion dollars to save the bankers from a financial crisis that they themselves have caused, programs on climate change get 313 times less, that is to say, only 13 billion dollars.

B) Absent growth, the U.S. will intervene in desperation, triggering lashout and nuclear holocaust.Burrows, Director of the Analysis and Production Staff in the National Intelligence Council, 09(Mathew J. Burrows, Director of the Analysis and Production Staff in the National Intelligence Council, 2009, “Revisiting the Future: Geopolitical Effects of the Financial Crisis,” The Washington Quarterly)

Types of conflict that the world continues to experience, such as over resources, could reemerge, particularly if protectionism grows and there is a resort to neo-mercantilist practices. Perceptions of renewed energy scarcity will drive countries to take actions to assure their future access to energy supplies. In the worst case, this could result in interstate conflicts if government leaders deem assured access to energy resources, for example, to be essential for maintaining domestic stability and the survival of their regime. Even actions short of war, however, will have important geopolitical implications. Maritime security concerns are providing a rationale for naval buildups and modernization efforts, such as China’s and India’s development of blue water naval capabilities. If the fiscal stimulus focus for these countries indeed turns inward, one of the most obvious funding targets may be military. Buildup of regional naval capabilities could lead to increased tensions, rivalries, and counterbalancing moves, but it also will create opportunities for multinational cooperation in protecting critical sea lanes. With water also becoming scarcer in Asia and the Middle East, cooperation to manage changing water resources is likely to be increasingly difficult both within and between states in a more dog-eat-dog world.

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China ! Scenario (1/2)

A. China will capitalize on the immediate recession and establish itself as the global financial hub.AFP, Agence France Presse, 08(AFP, Agence France Presse, November 5, 2008, “'Go East': China Inc. recruiting in gloomy London, New York,” http://afp.google.com/article/ALeqM5gQZZNGoiTxqAkAjWJEnWJwAISZsg)

SHANGHAI (AFP) — Spotting an opening in the global fight for talent, China's ambitious financial institutions are planning recruiting trips to London and Wall Street on the wounded financial titans' home turf. Sovereign fund China Investment Corporation has begun a global search, multi-billion dollar Chinese-French fund Fortune SGAM plans interviews on Wall Street and Shanghai's government is headed to London and New York next month with job offers in hand. "There are layoffs on Wall Street since the crisis but China's financial industry is still in its infancy and is hungry for talent," Pei Changjiang, chief executive of the Fortune SGAM Fund, told AFP. It is estimated that the economic turmoil could lead to 165,000 job losses in New York over the next two years, while British think tank Oxford Economics predicts 194,000 job cuts in London over the same period. But from Shanghai the message to the brightest finance minds is unmistakable: China is hiring. Han Zheng, mayor of the China's rapidly growing economic hub, has previously said by 2010 -- when Shanghai hosts the World Expo -- the city will have an infrastructure worthy of an international financial centre. By 2020, he said, it will be one. Since the financial crisis, city officials are saying that could now come even sooner The crisis has presented a rare lesson and opportunity and generally it will help accelerate the establishment of Shanghai as a global financial hub," said the city's deputy mayor in charge of economic affairs, Tu Guangshao. "The US is a fatty and needs to take diet pills but in contrast China is still skinny... It needs to build a strong body," the former vice-chairman of China's securities watchdog wrote in an opinion piece in the official China Business newspaper. More than 600 financial institutions had offices in Shanghai at the beginning of the year but finance jobs account for only 2.4 percent of the 9.1 million-strong workforce, compared to 11 percent in London and 12.7 percent in New York. "More foreign financial institutions will be willing to operate in China, where financial service is in short supply , as their business at home contracts," said Fang Xinghai, director of the city's Financial Services Office.

B. That results in a Sino-American war over Taiwan.Mearsheimer, professor of Political Science at the University of Chicago, 04(John Mearsheimer, professor of Political Science at the University of Chicago, September 17, 2004, “Why China’s Rise Will Not Be Peaceful,” http://mearsheimer.uchicago.edu/pdfs/A0034b.pdf)

The question at hand is simple and profound: can China rise peacefully? My answer is no. If China continues its impressive economic growth over the next few decades, the United States and China are likely to engage in an intense security competition with considerable potential for war. Most of China’s neighbors, to include India, Japan, Singapore, South Korea, Russia, and Vietnam, will join with the United States to contain China’s power. <<< CONTINUES – 20 PARAGRAPHS LATER – BREAK IN TEXT >>> China is likely to try to dominate Asia the way the United States dominates the Western Hemisphere. Specifically, China will seek to maximize the power gap between itself and its neighbors, especially Japan and Russia. China will want to make sure that it is so powerful that no state in Asia has the wherewithal to threaten it. It is unlikely that China will pursue military superiority so that it can go on a rampage and conquer other Asian countries, although that is always possible. Instead, it is more likely that it will want to dictate the boundaries of acceptable behavior to neighboring countries, much the way the United States makes it clear to other states in the Americas that it is the boss. Gaining regional hegemony, I might add, is probably the only way that China will get Taiwan back. An increasingly powerful China is also likely to try to push the United States out of Asia , much the way the United States pushed the European great powers out of the Western Hemisphere. We should expect China to come up with its own version of the Monroe Doctrine, as Japan did in the 1930s. These policy goals make good strategic sense for China. Beijing should want a militarily weak Japan and Russia as its neighbors, just as the United States prefers a militarily weak Canada and Mexico on its borders. What state in its right mind would want other powerful states located in its region? All Chinese surely remember what happened in the last century when Japan was powerful and China was weak. In the anarchic world of international politcs, it is better to be Godzilla than Bambi. Furthermore, why would a powerful China accept U.S. military forces operating in its backyard? American policymakers, after all, go ballistic when other great powers send military forces into the Western Hemisphere. Those foreign forces are invariably seen as a potential threat to American

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security. The same logic should apply to China. Why would China feel safe with (continues…no text removed)

China ! Scenario (2/2)

(Continues…no text removed)U.S. forces deployed on its doorstep? Following the logic of the Monroe Doctrine, would not China’s security be better served by pushing the American military out of Asia? Why should we expect China to act any differently than the United States did? Are they more principled than we are? More ethical? Less nationalistic? Less concerned about their survival? They are none of these things, of course, which is why China is likely to imitate the United States and attempt to become a regional hegemon. THE AMERICAN RESPONSE It is clear from the historical record how American policymakers will react if China attempts to dominate Asia. The United States does not tolerate peer competitors. As it demonstrated in the twentieth century, it is determined to remain the world’s only regional hegemon. Therefore, the United States can be expected to go to great lengths to contain China and ultimately weaken it to the point where it is no longer capable of ruling the roost in Asia. In essence, the United States is likely to behave towards China much the way it behaved towards the Soviet Union during the Cold War. China’s neighbors are certain to fear its rise as well, and they too will do whatever they can to prevent it from achieving regional hegemony. Indeed, there is already substantial evidence that countries like India, Japan, and Russia, as well as smaller powers like Singapore, South Korea, and Vietnam, are worried about China’s ascendancy and are looking for ways to contain it. In the end, they will join an American-led balancing coalition to check China’s rise, much the way Britain, France, Germany, Italy, Japan, and even China, joined forces with the United States to contain the Soviet Union during the Cold War. Finally, given Taiwan’s strategic importance for controlling the sea lanes in East Asia, it is hard to imagine the United States , as well as Japan, allowing China to control that large island. In fact, Taiwan is likely to be an important player in the anti-China balancing coalition, which is sure to infuriate China and fuel the security competition between Beijing and Washington.

C. Extinction.Straits Times 2k(Straits Times, June 25, 2000, “Regional Fallout: No one gains in war over Taiwan,” Lexis)THE high-intensity scenario postulates a cross-strait war escalating into a full-scale war between the US and China. If Washington were to conclude that splitting China would better serve its national interests, then a full-scale war becomes unavoidable. Conflict on such a scale would embroil other countries far and near and -- horror of horrors -- raise the possibility of a nuclear war. Beijing has already told the US and Japan privately that it considers any country providing bases and logistics support to any US forces attacking China as belligerent parties open to its retaliation. In the region, this means South Korea, Japan, the Philippines and, to a lesser extent, Singapore. If China were to retaliate, east Asia will be set on fire. And the conflagration may not end there as opportunistic powers elsewhere may try to overturn the existing world order. With the US distracted, Russia may seek to redefine Europe's political landscape. The balance of power in the Middle East may be similarly upset by the likes of Iraq. In south Asia, hostilities between India and Pakistan, each armed with its own nuclear arsenal, could enter a new and dangerous phase. Will a full-scale Sino-US war lead to a nuclear war? According to General Matthew Ridgeway, commander of the US Eighth Army which fought against the Chinese in the Korean War, the US had at the time thought of using nuclear weapons against China to save the US from military defeat. In his book The Korean War, a personal account of the military and political aspects of the conflict and its implications on future US foreign policy, Gen Ridgeway said that US was confronted with two choices in Korea -- truce or a broadened war, which could have led to the use of nuclear weapons. If the US had to resort to nuclear weaponry to defeat China long before the latter acquired a similar capability, there is little hope of winning a war against China 50 years later, short of using nuclear weapons. The US estimates that China possesses about 20 nuclear warheads that can destroy major American cities. Beijing also seems prepared to go for the nuclear option. A Chinese military officer disclosed recently that Beijing was considering a review of its "non first use" principle regarding nuclear weapons. Major-General Pan Zhangqiang, president of the military-funded Institute for Strategic Studies, told a gathering at the Woodrow Wilson International Centre for Scholars in Washington that although the government still abided by that principle, there were strong pressures from the military to drop it. He said military leaders considered the use of nuclear weapons mandatory if the country risked dismemberment as a result of foreign intervention. Gen Ridgeway said that should that come to pass, we would see

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the destruction of civilisation. There would be no victors in such a war. While the prospect of a nuclear Armaggedon over Taiwan might seem inconceivable, it cannot be ruled out entirely, for China puts sovereignty above everything else.

Terror ! Scenario

A. Economic growth is critical to preventing WMD terrorism.Burrows, Director of the Analysis and Production Staff in the National Intelligence Council, 09(Mathew J. Burrows, Director of the Analysis and Production Staff in the National Intelligence Council, 2009, “Revisiting the Future: Geopolitical Effects of the Financial Crisis,” The Washington Quarterly)

In surveying those risks, the report stressed the likelihood that terrorism and nonproliferation will remain priorities even as resource issues move up on the international agenda. Terrorism’s appeal will decline if economic growth continues in the Middle East and youth unemployment is reduced. For those terrorist groups that remain active in 2025, however, the diffusion of technologies and scientific knowledge will place some of the world’s most dangerous capabilities within their reach. Terrorist groups in 2025 will likely be a combination of descendants of long established groups—Inheriting organizational structures, command and control processes, and training procedures necessary to conduct sophisticated attacks—and newly emergent collections of the angry and disenfranchised that become self-radicalized, particularly in the absence of economic outlets that would become narrower in an economic downturn.

B. Extinction.Speice, J.D., associate in Gibson, Dunn & Crutcher's Washington, D.C. office, 06(Patrick Speice, J.D., associate in Gibson, Dunn & Crutcher's Washington, D.C. office, February 2006, 47 Wm and Mary L. Rev. 1427, Lexis)

The potential consequences of the unchecked spread of nuclear knowledge and material to terrorist groups that seek to cause mass destruction in the United States are truly horrifying. A terrorist attack with a nuclear weapon would be devastating in terms of immediate human and economic losses. 49 Moreover, there would be immense political pressure in the United States to discover the perpetrators and retaliate with nuclear weapons, massively increasing the number of casualties and potentially triggering a full-scale nuclear conflict. 50 In addition to the threat posed by terrorists, leakage of nuclear knowledge and material from Russia will reduce the barriers that states with nuclear ambitions face and may trigger widespread proliferation of nuclear weapons. 51 This proliferation will increase the risk of nuclear attacks against the United States [*1440] or its allies by hostile states, 52 as well as increase the likelihood that regional conflicts will draw in the United States and escalate to the use of nuclear weapons.

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**COMPETITIVENESS**

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Competitiveness K2 Heg

Competitiveness is key to US hegemony and economySegal 04 – Senior Fellow in China Studies at the Council on Foreign Relations[Adam, Foreign Affairs, “Is America Losing Its Edge?” November / December 2004, http://www.foreignaffairs.org/20041101facomment83601/adam-segal/is-america-losing-its-edge.html]

The United States' global primacy depends in large part on its ability to develop new technologies and industries faster than anyone else. For the last five decades, U.S. scientific innovation and technological entrepreneurship have ensured the country's economic prosperity and military power. It was Americans who invented and commercialized the semiconductor, the personal computer, and the Internet; other countries merely followed the U.S. lead. Today, however, this technological edge-so long taken for granted-may be slipping, and the most serious challenge is coming from Asia. Through competitive tax policies, increased investment in research and development (R&D), and preferential policies for science and technology (S&T) personnel, Asian governments are improving the quality of their science and ensuring the exploitation of future innovations. The percentage of patents issued to and science journal articles published by scientists in China, Singapore, South Korea, and Taiwan is rising. Indian companies are quickly becoming the second-largest producers of application services in the world, developing, supplying, and managing database and other types of software for clients around the world. South Korea has rapidly eaten away at the U.S. advantage in the manufacture of computer chips and telecommunications software. And even China has made impressive gains in advanced technologies such as lasers, biotechnology, and advanced materials used in semiconductors, aerospace, and many other types of manufacturing. Although the United States' technical dominance remains solid, the globalization of research and development is exerting considerable pressures on the American system. Indeed, as the United States is learning, globalization cuts both ways: it is both a potent catalyst of U.S. technological innovation and a significant threat to it. The United States will never be able to prevent rivals from developing new technologies; it can remain dominant only by continuing to innovate faster than everyone else. But this won't be easy; to keep its privileged position in the world, the United States must get better at fostering technological entrepreneurship at home.

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Econ K2 Heg

A strong economy is key to military strength and sustainable hegemony.Richard Holbrooke, U.S. Ambassador to the United Nations from 1999 to 2001, Current Chair of Asia Society, Foreign Affairs September/October 08, “The Next President: Mastering a Daunting Agenda”

To restore the United States to its proper world leadership role, two areas of weakness must be repaired: the domestic economy and the United States' reputation in the world. Although the economy is usually treated as a domestic issue, reviving it is as important to the nation's long-term security as is keeping U.S. military strength unchallengeable . This will require more than a cyclical upturn; to repair the economy in the long term, a new national policy on energy and climate change will be essential. And restoring respect for American values and leadership is essential -- not because it is nice to be popular but because respect is a precondition for legitimate leadership and enduring influence. The president should address both issues as early as possible in order to strengthen his hand as he tackles pressing strategic issues, including the five neighboring countries at the center of the arc of crisis that directly threatens the United States' national security -- Turkey, Iraq, Iran, Afghanistan, and Pakistan. A few early actions that lie wholly within his authority can make an immediate impact. The most compelling such actions would be issuing a clear official ban on torture and closing the detention facility at Guantánamo Bay, Cuba, which now holds only 260 prisoners. Because the Bush administration limited itself to punishing only those at the very bottom of the chain of command at Abu Ghraib, the damage to the United States' image has been immense and continuing -- the gift that keeps on giving to the United States' enemies. Presidential directives making clear that the U.S. government does not tolerate or condone torture are necessary in order to separate the new administration from that costly legacy. As for Guantánamo, closing it is complicated, as Bush administration apologists (and many lawyers) say. Well, a lot of things in life are complicated. Guantánamo must not become the next president's albatross, too; closing it, no matter how difficult, is not just desirable but imperative. A NEW FACTOR History is not immutable. But there is one pattern that comes very close to being a law of history: in the long run, the rise and fall of great nations is driven primarily by their economic strength. Rome, imperial China, Venice, France, the Netherlands, Portugal, the United Kingdom -- all had their day, and their international decline followed inexorably from their economic decline.

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Econ Decline Killing Heg Now

Economic decline is killing US hegemony now. Ferguson, 9 (Niall, “The Trillion Dollar Question,” The Daily Telegraph, 6/2/09, lexis)

In February, the People's Daily acknowledged the "global importance and influence'' of Chimerica, but warned of an impending "period of chillness''. Could this be one of those great turning points in history, when the balance of power tilts decisively away from an established power and towards a rising challenger? It is possible. Financial crises often accelerate the gradual shifting of the geopolitical tectonic plates ; they are to history what earthquakes are to geology. It was inflation that undermined the foundations of Habsburg power and opened the way for the Dutch Republic. It was the disastrous Mississippi Bubble of 1718-19 that fatally weakened ancien régime France, while Britain survived the contemporaneous South Sea Bubble with its fiscal system intact. For most of the nineteenth century, financial crises in the United States had only marginal effects on the City of London. By 1907, however, a Wall Street crash could send a shockwave across the entire British Empire, a harbinger of a new era of American power.   Something similar may be happening as a consequence of the American financial crisis that began nearly two years ago. The flapping of a butterfly's wings may trigger a hurricane in the Home Counties; in much the same way, a crisis in the market for subprime mortgages could signal the waning of US hegemony and the advent of a Chinese century. Just visit the nearest bookshop if you don't believe me. There, alongside Fareed Zakaria's prophetic The Post-American World, you'll soon find Martin Jacques's darkly visionary When China Rules the World.  Just consider the impact of this crisis on the United States and China. According to the International Monetary Fund, the US economy will contract by 2.8 per cent this year - while China's is forecast to grow by more than 6 per cent.     The US stimulus package - worth $787 billion - has had rather a muted impact . The economy will do better in the current quarter than in the last one. But house prices are still falling at close to 20 per cent year on year. The rate of foreclosures per month is still rising. And a crisis in commercial real estate could blow a new hole in the balance sheets of US banks.   Moreover, no amount of stimulus can swiftly reduce the debt burden weighing down America's over-leveraged consumers. According to Bank Credit Analyst research, for household debt to return to a more sustainable level, real consumer spending would need to grow at no more than 1.3 per cent a year between now and 2013. If that calculation is correct, the Obama administration will have to junk its predictions of 3 per cent growth next year and 4 per cent the year after that.  China's stimulus is worth less in dollar terms - $585 billion - but Beijing is clearly getting more bangs for its bucks. In April, fixed investment surged by nearly     34 per cent . Net imports of iron ore leapt by a third, and imports of oil by just under 14 per cent. It's a measure of China's new economic influence that commodity traders attribute much of the recent upward pressure on oil, copper and other raw material prices to Chinese purchases. Indeed, China's growing presence in commodity markets in sub-Saharan Africa and South America - not just as a buyer, but also as an investor - has an almost imperial character to it.  Of course, China has not been wholly unscathed by the astonishing collapse of exports that struck Asian economies in late 2008 and early 2009. Many more Chinese than American workers have lost their jobs since this crisis began. Yet I do not believe (as some Sino-pessimists do) that the regime in Beijing faces a serious threat of social unrest. Like other rising powers in past centuries, China is imbued with a remarkable sense of patriotism that is not just a product of Communist Party propaganda. People are proud of their country's economic miracle over the past 30 years. After two wretched centuries, they believe China is on the way back. People whose grandparents survived the Great Leap Forward and whose parents endured the Cultural Revolution can surely cope with a decline in the growth rate from 11 to 6 per cent.   In short, it may be time to start believing the projections made by Jim O'Neill and his colleagues at Goldman Sachs, who predicted just a few years ago that China's gross domestic product could equal that of the United States by 2027. Three years ago, China did not have a single bank among the world's top 20, measured by market capitalisation. Today the top three are all Chinese. In 2006, the United States had seven of the top 20 banks, including the top two; today it has three, and the biggest, JP Morgan Chase, is rated fifth.   Even before its economy becomes the world's biggest, China can play a much more assertive role in its relations with the United States. The spouse with the money generally wins the argument, after all. Especially when the argument is about the other spouse's debts.  And what debts! The US federal government's deficit this year will be $1.84 trillion - roughly half of total expenditure and nearly 13 per cent of GDP. Not since the Second World War has the gap between income and spending been so huge. Moreover, the Congressional Budget Office anticipates that total debt will nearly double in the decade ahead. With the lion's share (around 70 per cent) of their $2 trillion of international reserves held in the form of US bonds, the Chinese are understandably alarmed by this tsunami of red ink. Last week's financial market action - which saw both bonds and the dollar drop sharply - will have caused palpitations in Beijing.   To be sure, China is still piling up those dollar-denominated bonds. In March alone, China's holdings of US Treasuries rose $23.7 billion. But Deutsche Bank recently predicted that Chinese reserves will rise by only $100 billion this year, compared with $418 billion last year. You don't need a Nobel prize in economics to know that $100 billion won't finance much of a $1.84 trillion deficit. 

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Econ K2 Obama Agenda

Econ key to Obama’s agenda – must follow through on high expectations and promises.Cummings, managing editor. 7/14/09.Jeanne. “Experts: Obama Too Optimistic on Economy.” CBS News/Politico. http://www.cbsnews.com/stories/2009/07/14/politics/politico/main5157452.shtml [Mardjuki]

President Barack Obama’s economic forecasts for long-term growth are too optimistic, many economists warn, a miscalculation that would mean budget deficits will be much higher than the administration is now acknowledging. The White House will be forced to confront the disconnect between its original, upbeat predictions and the mainstream consensus about how the economy is likely to perform in a new budget forecast to be unveiled next month. Christina Romer, chairwoman of the White House’s Council of Economic Advisers, said in a POLITICO interview that the administration - like many independent economists - did not fully anticipate the severity and pace of this recession. She said the White House will be updating its official forecasts. The new numbers will come as part of a semiannual review that, under ordinary circumstances, is the kind of earnest-but-dull document that causes many Washington eyes to glaze over. This time, however, the new forecasts - if they are anything like what many outside economists expect - could send a jolt through Capitol Hill, where even the administration’s current debt projections already are prompting deep concerns on political and substantive grounds. Higher deficit figures also would arrive at a critical moment in the health care debate, as lawmakers are already struggling to find a way to pay for the president’s nearly $1 trillion reform package. Alternately, if Obama clings to current optimistic forecasts for long-term growth, he risks accusations that he is basing his fiscal plans on fictitious assumptions - precisely the sort of charge he once leveled against the Bush administration. White House officials rebuff such suggestions, saying the midyear correction is precisely intended to keep their economic program reality based. But a series of POLITICO interviews in recent days with independent economists of varied political stripes found widespread disdain for Obama’s first round of assumptions, with some experts invoking such phrases as “rosy” and “fantasy.” Obama’s current forecasts envision 3.2 percent growth next year, 4 percent growth in 2011, 4.6 percent growth in 2012 and 4.2 percent growth in 2013. The administration is already under intense pressure over its economic calculations on the most politically sensitive statistic: employment. The administration once vowed to use stimulus policies to keep the jobless rate below 8 percent; it is now just shy of 10 percent. Deficit figures do not pack the same emotional punch as unemployment lines do. But they matter greatly to policymakers and the financial markets as a measure of whether the country can afford Obama’s big agenda. And the general public is paying attention, too. In a June NBC/Wall Street Journal poll, a bare majority - 51 percent - of respondents approved of Obama’s handling of the economy, down from 56 percent in February. In addition, 58 percent said the president and Congress should focus on keeping deficits down, even if that delays an economic recovery, the poll found. “They used a rosy forecast, and that’s understandable because a quick recovery makes the rest of the agenda possible. It creates the basis for the revenues you need for health care and climate change,” said Robert Shapiro, a former Clinton economic adviser. “But it’s also dangerous and risky because if the forecast doesn’t come true, you’ve undermined the basis for the rest of your policies,” he added.

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HC Reform Key to Econ

National Health Insurance would cut annual costs by $300 billion, 15% of current health spendingHimmelstein, dept Medicine Harvard, and Woolhandler, MD + MPH, ‘07(David U. Himmelstein, MD; The Department of Medicine at Cambridge Health Alliance/Harvard Medical School, and Steffie Woolhandler, MD, Physicians for a National Health Program of Chicago, 11/07, “Our Health Care System at a Crossroads: Single Payer or Market Reform?” www.pnhp.org/news/2008/may/our_health_care_syst.php) [LO//JW] 

In contrast to CDH, a properly structured NHI program could expand coverage without increasing costs by reducing the huge health administrative apparatus that now consumes 31% of total health spending. Health care’s enormous bureaucratic burden is a peculiarly American phenomenon. No nation with NHI spends even half as much administering care nor tolerates the bureaucratic intrusions in clinical care that have become routine in the United States. Indeed, administrative overhead in Canada’s health system, which resembles that of the United States in its emphasis on private, fee-for-service–based practice, is about half the US level.Our biggest HMOs keep 20%—even 25%—of premiums for their overhead and profit; Canada’s NHI has 1% overhead and even US Medicare takes less than 4%. And HMOs inflict mountains of paperwork on doctors and hospitals. The average US hospital spends one-quarter of its budget on billing and administration, nearly twice the average in Canada. American physicians spend nearly 8 hours per week on paperwork and employ 1.66 clerical workers per doctor, far more than in Canada.Reducing our bureaucratic apparatus to Canadian levels would save about 15% of current health spending, $300 billion annually, enough to fully cover the uninsured and to upgrade coverage for those now underinsured. Proponents of NHI, disinterested civil servants and , and even skeptics all agree on this point.Unfortunately, neither piecemeal tinkering nor wholesale computerization can achieve significant bureaucratic savings. The key to administrative simplicity in Canada and other nations is single-source payment. Canadian hospitals, which are mostly private, nonprofit institutions, are paid a global annual budget to cover all costs, much as a fire department is funded in the United States, obviating the need for administratively complex per-patient billing. Canadian physicians, most of whom are in private practice, bill by checking a box on a simple insurance form. Fee schedules are negotiated annually between provincial medical associations and governments. All patients have the same coverage.

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Deflation Coming

Deflation is a pertinent threat in the short-term and could lead to a deflationary spiral, leading to job loss and decreased production Isidore, senior writer for CNN Money, 7/23Chris Isidore, senior writer for CNNMoney, “The inflation vs. deflation debate” http://money.cnn.com/2009/06/23/news/economy/inflation_deflation_debate/index.htm?postversion=2009062313But others argue the economy is still so weak that deflation, or a drop in prices, is the more serious threat. The Consumer Price Index, the government's key inflation measure, posted its largest 12-month drop since 1950 in May. This year-over-year decline in prices, coupled with rising unemployment and low factory utilization, could be signs that prices are likely to keep falling. And while lower prices might sound like a positive to consumers with budgets stretched to the breaking point, economists are in general agreement that deflation is far more destructive to the economy than inflation. Businesses unable to make a profit in an environment of declining prices will likely cut production and lay off more workers. That could cause a deflationary spiral. The Great Depression and Japan's so-called Lost Decade of economic stagnation are both well-documented examples of the damage that deflation can cause. "I think the predominant risk in the next 6 to 12 months is deflation," said Mark Zandi, chief economist at Moody's Economy.com. "There's excess capacity everywhere. There's vacant real estate across all property types. Unemployment continues to rise. I don't see how businesses can raise prices in this environment."

Experts believe that deflation and depression will come soonParry, Haddadin, and Mnyandu 5/14John Parry, Hathaim Haddadin, and Ellis Mnyandu , reporters for Reuters “Stocks still face deflationary collapse: Prechter” http://www.reuters.com/article/wtUSInvestingNews/idUSTRE54D4IL20090514?pageNumber=2&virtualBrandChannel=0NEW YORK (Reuters) - Longtime technical analyst Robert Prechter, who forecast the 1987 stock market crash, predicted this week that U.S. equities may plunge to half their lows hit in March as a deflationary depression bites. Oil and U.S. Treasury bonds are also locked in long term bear markets, while corporate bond prices will plunge precipitously by next year as broad economy, banking system and company earnings sustain more damage from a financial crisis that's akin to the Great Depression, he said. The U.S. S&P 500 stock index's rebound by nearly 40 percent since it sagged to a 12-year closing low of 676 points on March 9 is not sustainable, Prechter said in an interview with Reuters. "It's not the start of a new bull market," said Prechter, chief executive at research company Elliott Wave International in Gainesville, Georgia. "Our models are (showing) right now that it is a much bigger bear market than most people realize, something along the lines of 1929-1932," he told Reuters in a wide ranging interview. "It's a very rare event," he added. "I think the next leg down will be at least as severe if not more severe than what we just experienced. So you want to stay on the side of safety," he said. As in his 2002 book "Conquer the Crash," which warned of the dangers of a U.S. debt bubble and deflationary depression, Prechter continues to advocate safer cash proxies such as Treasury bills. SEVEN MORE YEARS? Riskier assets such as commodities, corporate bonds, and stocks which are currently anticipating that the severe global economic downturn may be bottoming, are likely to have short lived intense rallies, but within an inexorable long-term decline that may last another seven years, he said. As banks continue to accumulate losses and corporate earnings fall, "the difficulties will probably last through about 2016," he said. "There will be plenty of rallies along the way." Oil may rally further from current levels just below $60 per barrel but the upside will be capped at about $80 per barrel as the commodity is locked in a long-term bear market, he said. In July, U.S. crude oil hit a record peak above $147 per barrel and was just above $57 per barrel around noon on Thursday. "Deflation is coming, it's going to lead to a depression. We're not at the bottom yet," Prechter said. "I think we are going to have bouts of deflation separated by recoveries." Prechter also painted a bleak picture for commodities like silver and is largely unenthusiastic about gold, believing the precious metal made a major peak when it rose above $1,000 last year. While gold may have already topped at above $1,000 an ounce in March 2008, Treasury bond prices are likely to fall in a long term bear market, with huge government debt issuance being the main catalyst. The benchmark U.S. 10-year Treasury note yield, which moves inversely to its price, hit a five-decade low of 2.04 percent in mid-December.

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Deflation Coming

Economists agree that deflation is a major possibility and could culminate in a depression Isidore, senior writer for CNN Money, 08Chris Isidore, senior writer for CNNMoney, “The growing threat of deflation” http://money.cnn.com/2008/12/17/news/economy/deflation/?postversion=2008121810NEW YORK (CNNMoney.com) -- Lower prices are probably at the bottom of the list of most Americans' current economic worries. But for a growing number of economists, it's their biggest fear. A widespread drop in prices is known as deflation. And typically, it's not just the price of consumer goods that fall. Home prices, stock prices and even people's salaries often head lower as well. The biggest problem with deflation is that when businesses need to continually cut prices to spur sales, they eventually respond by cutting production. That results in growing job losses, and could, in the worst case scenario, even cause a depression. And several economists say they are far more worried about the threat of deflation now than they have been in the past. The Federal Reserve may also be more concerned about deflation as well.

Falling wages and constant debts mean that deflation is destructive to the economyAtkinson 09Dan Atkinson, writer for ThisisMoney “Deflation: Who wins when prices fall?” http://www.thisismoney.co.uk/news/article.html?in_article_id=468029&in_page_id=2For anyone living on a budget - that is, almost everyone - the prospect of falling prices must sound like heaven, the adult equivalent of being given the run of a sweet shop. Every month, your pound goes further. Without lifting a finger, you become better off. It is called deflation and there have been new warnings about it from the Bank of England. With the world sliding into recession, deflation in Britain has become a real possibility. Warnings? Why would any kind of killjoy warn against this latter-day consumer paradise? The short answer is deflation is a disaster in the making, a viral attack on the economy. Put simply, where does your pay come from if not from prices? Unless you are very lucky and your line of work somehow escapes the crumbling of prices, then your income will be sucked into the downward spiral. Deflation is a general fall in the overall level of prices. In Japan they call it 'price destruction', and they should know - Japan was plagued by deflation in the Nineties and it caused havoc with its economy. Yet the feeling persists that falling prices must be beneficial. But ingrained deflation is bad for the same underlying reason that high inflation is bad: it destroys money values and confidence in the price system. More specifically, deflation causes chaos on a number of fronts. It eats into earnings. Anyone in the private sector relies on prices of some sort - be it the cost of a cup of tea for a cafe owner or fees for an architect - for their income. It is little use a greengrocer rejoicing over a shrinking fuel bill if the prices he can charge for his produce are also dwindling. Public-sector workers are better protected for a while, but ultimately their salaries are paid from the taxes levied on earnings and, thus, prices. So we're all in the same boat. Deflation destroys incomes but not debts. Earnings may shrink, but borrowings remain stubbornly of the same size. This inevitably bears down on economic activity, worsening the squeeze. When inflation is high, people buy now, assuming that prices will be even higher next week. Deflation throws that process into reverse. It makes no sense to buy now what will be cheaper next week or next month. This becomes a self fulfilling prophecy. As people hold off, prices fall further. While high levels of inflation are a menace, a moderate level helps oil the wheels of the economy. That is why the Bank of England's job is to hold inflation not at zero but at two per cent a year. Moderate inflation is useful.

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Increases Competitiveness

Single Payer healthcare benefits spillover, increasing competitiveness and decreasing the cost to make goodsRobinson No Date GivenBruce Robinson, Wakeforest Law School Graduate and Lawyer, “Canada's Single Payer Health Care System - It's Worth a Look” http://bcn.boulder.co.us/health/healthwatch/canada.html[LO//AS]The Canadian system is a publicly funded insurance program where costs are controlled and both hospitals and doctors are private. Any Canadian can go to any doctor or hospital in the country. Each province has its own system and its own unique way of funding it. In spite of this decentralized approach, there are agreements among all provinces that provide for treatment of any Canadian citizen regardless of where the need occurs. The great success of their system causes almost all Canadian politicians, even conservatives, to defend it vociferously. It is called single payer because there is only one "payer"; there is no alternative program, such as private health insurance, to which Canadians can turn for basic health care. Since the wealthy as well as the middle income people have no alternative, they make sure it is funded adequately. This together with cost controls insures that everyone including the poor, who use the same system, receives the same high quality care. Canada has a much higher percentage of general practitioners and fewer specialists. Canadian doctors make about one third less that American doctors and yet their satisfaction level is high because they have more time to practice medicine because paper work is minimized. Since there is a "single payer", it is easier to set up and adhere to budgetary limits. Effective planning eliminates duplication of facilities and expensive technology. In the U.S., competition has led to great redundancies in expensive equipment such as for CAT scans; doctor groups buy high technology equipment and then compete for selling these services. The economic advantages of the Canadian system are multi-faceted. Canadians are healthier and live longer than Americans. Preventive care to an entire population minimizes expensive care associated with undetected, untreated health problems. There is very little litigation because there is no need for awards to cover future health care costs; they are already covered. Further savings occur because there is no longer a need for a health insurance component of automobile or home insurance. There is less loss of productive labor due to absence and sickness and health care is much more practical and less expensive for companies to provide to employees. Estimates show that Canadians produce American cars for $700 less than Americans do because of the difference in the costs of providing health care to employees. The benefits to competitiveness are obvious.

Single payer healthcare decreases the cost of employees, increasing business competitiveness and stopping outsourcing Lohman No Date GivenJack Loman, retired business owner and member of the Business Coalition for Single Payer Healthcare “Why should businesses support single-payer healthcare?” http://www.businesscoalition.net/why_should_businesses.htm

Businesses would no longer provide health care, though under the current proposal they would pay an additional 3.3% healthcare tax on payroll. But this would be more than offset by the 10-15% of wages they'd no longer have to pay for health benefits. Workers would also be taxed an additional 3.3%, but this would be offset by the elimination of co-pays, deductibles, and the costs for prescription drugs, mental health, long-term care, vision and dental. And it would be portable, so employees changing jobs would no longer suffer delays and costs for COBRA, which often is picked up by the new employer. We'd have a Cadillac system for the same 16% of GDP we are spending today, and we'd make businesses more competitive with their foreign competitors and keep more jobs in the United States. And we'd improve the economy as families would have more money to spend on products and services. The bankruptcy attorneys might not like it because over 50% of bankruptcies are due to health care costs, but they'll survive. More importantly, so will the 18,000 Americans who die prematurely because they have no health care at all.

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Competitiveness K2 Growth

Competitiveness is key to economic growth. Gary Bachula, Under Secretary for Technology, U.S. Dept. of Commerce, 3-11-1998. [Federal News Service, Prepared Testimony before the House Appropriations Committee, p. lexis]

My testimony this morning will address the initiatives of the Technology Administration, focusing primarily on the Office of the Under Secretary and the Office of Technology Policy (US/OTP). NIST Director Ray Kammer will discuss the Institute's budget request. I Technological Leadership is Vital to U.S. Economic Growth, Jobs & Competitiveness Technology is the engine of economic growth. Technology is the single most important driver of economic growth, accounting for as much as 50 percent of the Nation's long-term growth, according to leading economists. Now, as we approach the new millennium, technology is playing an ever increasing role at home and around the world--in securing improvements in our standard of living, our quality of life, the economic security of our country, and the competitiveness of American companies.

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**Medicaid Reform**

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Federalize Medicaid Good

Federalization of Medicaid increases quality of care, acts as a macroeconomic stabilizer, and reduces severity of recessions.Yglesias, associate editor @ Atlantic Monthly and TPM Media. 7/20/09. Matt. “Medicaid and Health Reform.” Think Progress. http://yglesias.thinkprogress.org/archives/2009/07/medicaid-and-health-reform.php [JM]

Kevin Sack and Robert Pear reporting for the New York Times raise a non-crazy worry about the health reform legislation before the congress, gubernatorial concerns that Medicaid expansion will wreak devastation on state budgets. My go-to guy on Medicaid issues says the House bill handles this concern fairly well, but that the Senate legislation is less clear. And certainly when you become very concerned with slightly arbitrary metrics like CBO scores across a 10-year window rather than with overall fiscal responsibility, it creates incentives to craft legislation that shunts costs onto the states thus “hiding” them from the prying eyes of the scorekeepers. To the best of my knowledge, the large state role in Medicaid is extremely ill-advised. In general in the United States you get better “quality of government” at the federal than at the state level. And in macroeconomic terms, state Medicaid responsibilities tend to work as “automatic destabilizers,” increasing burdens on state government just when the states can’t afford to spend money. In an ideal world, you’d see a much larger federal role in Medicaid and this would reduce the severity of recessions and in general reduce the need for contentious debates about stimulus bills. You’d also almost certainly get better health care coverage for poor people in most of the country. But even though switching the financial responsibility from the state to the federal level wouldn’t involve any net change in the tax burden or the size of the public sector, it would “look like” a big increase in taxes and spending. So that’s obviously off the table for now. But something to keep an eye on during the health reform debate is that while Medicaid expansion is good, mandated increases in state-level Medicaid expenditures are pretty questionable policy. Better to have the federal government pick up the bulk of the tab for expansions.

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Medicaid Reform Needed

Medicaid costs is the cause of state budget crisis’s Ezra Klein, associate editor at The American Prospect, 7-19-2009, “Guest Graph: The Future of Medicaid” http://voices.washingtonpost.com/ezra-klein/2009/06/guest_graph_the_future_of_medi.html

As state and local medical expenditures cross the $300 billion mark, the existing framework no longer works. Rising Medicaid expenditures undermine states’ ability to address other pressing needs. Saddled with balanced-budget requirements and constrained tax bases, dozens of states are cutting or constraining services at precisely the moment when these services are most needed to meet human needs and to stabilize local economies. The cuts seem most dramatic in California. Yet painful measures are being taken in many other states.What can be done? First, we must recognize that the budget challenge is more than a nasty episode brought on by the current downturn. States’ Medicaid problems have been building for decades. In truth, states have cut financial corners for decades, underpaying providers, delaying payment, failing to operate these programs with the skill and humanity that patients deserve. The worst is yet to come. Actuaries predict that state Medicaid expenditures will roughly double by 2017.

Federalized Medicaid solve long-term budget for statesEzra Klein, associate editor at The American Prospect, 7-19-2009, “Guest Graph: The Future of Medicaid” http://voices.washingtonpost.com/ezra-klein/2009/06/guest_graph_the_future_of_medi.html

Looking at these figures, you might reasonably ask: Why are states complaining? The answer is: They lack the fiscal capacity to bear the load. They face legal and institutional constraints on deficit financing and new taxes. They bear the consequences of their severe, bipartisan mismanagement of public employee health and retiree benefits.States also bear readily-overlooked systemic risks. Suppose, for example, that medical improvements gradually raise average lifespan of Alzheimer’s patients in long-term care. Or suppose that the firms which offer private long-term care policies run into trouble. It’s all too plausible to devise scenarios in which state Medicaid programs end up bearing large unanticipated costs.One way or another, the federal government must carry an increasing share of the Medicaid burden . Properly designed, health reform can also help by providing new forms of public or private coverage for low-income Americans who might otherwise require Medicaid. The impact of competing proposals for state finances has received less attention than it should.The recent stimulus package suggests another useful path. Until December 31, 2010, the federal government agreed to pay a higher matching rate to states that agreed to maintain Medicaid eligibility and benefits at roughly pre-recession levels. These subsidies should be enlarged and made permanent, in return for greater federal oversight over matters such as quality assurance and reimbursement.These fixes will help, but they will not be enough. As my colleague Colleen Grogan suggests, we should recognize and embrace the fact that Medicaid has become a central pillar of the American welfare state, not only for poor people, but for millions of others, too. The program has outgrown the financial and administrative capacity of state governments. Yet another challenge of health reform.

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Medicaid Reform Needed

Medicaid should be funded solely by the federal governmentKevin Drum, staff writer for Mother Jones, 7-11-2009, “Let the States Fund Medicaid?”, http://www.motherjones.com/kevin-drum/2009/07/let-feds-fund-medicaid

If we need more stimulus, what form should it take?  Matt Yglesias comments:In an ideal world at this point what I’d like to see is more aid to state and local governments . Probably this should just be done in a very crude way — some flat per capita disbursement that could be implemented very rapidly at the federal level and kick specific decisions to someone else. Some of the money would be wasted or used in bad ways, but it wouldn’t be congress or the executive branch doing the wasting, so it’d be someone else’s problem. That kind of thing would work quickly, would be highly stimulative, and would allow structural shifts in the private sector to proceed apace.Well, one quick way to do this might be to stop dinking around with alterations to the Medicaid funding formula (as the first stimulus bill did) and simply turn Medicaid into a purely federal program funded entirely with federal dollars.  This would instantly save states something on the order of $100 billion or so.  Here in California, we'd save a little over $10 billion, which would be $10 billion less in demand-destroying budget cuts we'd have to make.  Eventually this might lead to Medicaid becoming more standardized throughout the country, rather than being a hodgepodge of 50 different plans, but that's probably OK.  I'm not sure Medicaid has really been a great poster child for states as laboratories of democracy anyway.  Maybe it's time to turn the entire program over to the feds so it's not constantly a procyclical drain on the economy and be done with it.

Federal only Medicaid more effective than state and lessens state’s burdens Matthew Yglesias, associate editor of The Atlantic Monthly, 7-20-2009, “Medicaid and Health Reform”, http://yglesias.thinkprogress.org/archives/2009/07/medicaid-and-health-reform.php

Kevin Sack and Robert Pear reporting for the New York Times raise a non-crazy worry about the health reform legislation before the congress, gubernatorial concerns that Medicaid expansion will wreak devastation on state budgets. My go-to guy on Medicaid issues says the House bill handles this concern fairly well, but that the Senate legislation is less clear. And certainly when you become very concerned with slightly arbitrary metrics like CBO scores across a 10-year window rather than with overall fiscal responsibility, it creates incentives to craft legislation that shunts costs onto the states thus “hiding” them from the prying eyes of the scorekeepers. To the best of my knowledge, the large state role in Medicaid is extremely ill-advised. In general in the United States you get better “quality of government” at the federal than at the state level. And in macroeconomic terms, state Medicaid responsibilities tend to work as “automatic destabilizers,” increasing burdens on state government just when the states can’t afford to spend money. In an ideal world, you’d see a much larger federal role in Medicaid and this would reduce the severity of recessions and in general reduce the need for contentious debates about stimulus bills. You’d also almost certainly get better health care coverage for poor people in most of the country. But even though switching the financial responsibility from the state to the federal level wouldn’t involve any net change in the tax burden or the size of the public sector, it would “look like” a big increase in taxes and spending. So that’s obviously off the table for now. But something to keep an eye on during the health reform debate is that while Medicaid expansion is good, mandated increases in state-level Medicaid expenditures are pretty questionable policy. Better to have the federal government pick up the bulk of the tab for expansions.

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Medicaid Reform Needed

Medicaid reform sorely needed – failure to achieve its goals.De Alteriis, Associate at MHA. 1992.Martin. “Medicaid’s Role in Moves Toward Universal Health Care.” Policy Studies Review, Winter 1992, Volume 11. [Mardjuki]

It is widely recognized that the United States spends far more on health care than any other nation but nevertheless fails to provide health coverage for many millions of its citizens. While other OECD nations have successfully curbed health care inflation, costs are expected to rise still further in the U.S. According to the latest estimates, total health care expenditures will rise from about 12 percent of GNP in 1990 to about 18 percent of GNP by the year 2000 (Burner, Waldo and McKusick, 1992). Despite these expenditures, between 30 and 40 million Americans do not have health coverage (Levit,Olin and Letsch, 1992).The current program for providing the poor with health care coverage is part of the problem. The Medical Assistance program (Medicaid) provides health services for around 20 million poor Americans. Since its inception in 1966, it has been much criticized and its costs have soared. Many recipients have difficulty accessing care; what they can obtain is often of poor quality. There are geographic and demographic inequities in service provision. Most importantly, Medicaid does not cover all poor individuals. This paper considers the problems faced by the Medicaid program in the context of the problems faced by the American health care system. Remedial measures that have already been tested are examined, as well as a number of other possibilities and permutations. We argue that Medicaid can only be successfully restructured as part of a major reform of the entire American health care system. Finally, we contend that the existing research tells us what should be done; what we need now is the political will to act.

Medicaid expensive and ineffective – limited access to proper care.De Alteriis, Associate at MHA. 1992.Martin. “Medicaid’s Role in Moves Toward Universal Health Care.” Policy Studies Review, Winter 1992, Volume 11. [Mardjuki]

Medicaid is very costly. When the program was initiated in 1966, total annual federal and state costs were $1.5 billion; by 1990 total costs had reached $75 billion. Preliminary data for 1991 suggest that total costs rose by more than 30 percent to $98 billion; total costs for 1992 are projected to reach $129 billion (Burner et al., 1992). Despite the program's costs, Medicaid eligibles have difficulty accessing care. One reason is that Medicaid fees for private physicians, even in the most generous states, are usually far lower than those allowed by private insurers and the Medicare program (Cromwell and Burstein, 1985). Low fees have led to low physician participation rates (Perloff, Kletke and Ncckerrnan, 1987; Held, Holahan and Carlson, 1983). Access to physicians is also limited by the fact that many mainstream providers are reluctant to treat Medicaid recipients for a whole host of nonmonetary reasons: excessive paperwork, reported delays in payment, bureaucratic interference and the low status of the recipients (Holahan, 1975). One study even found that a large proportion of private physicians refused to treat Medicaid recipients because of their ideological opposition to government involvement in health care provision (Sloan, Cromwell and Mitchell, 1978). Even if Medicaid recipients are seen by private providers, the quality of care they receive is often poor. Those physicians who do treat large Medicaid caseloads tend to be older, more likely to have graduated from foreign medical schools and have fewer hospital accreditations (Yett, Der, Ernst and Hay, 1981). Some of these physicians attract scarcely any private patients. Others recognize the economic advantages of very large Medicaid practices, which can compensate for the low fees by generating enormous volumes of claims (Cromwell and Mitchell, 1984). These large Medicaid practices are also known as "Medicaid mills." They provide shorter visits and fewer physical examinations than mainstream medical practices (Mitchell and Cromwell, 1980).

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Medicaid Reform Needed

Patchwork state Medicaid programs must be rectified to correct inequal treatment of the impoverished.De Alteriis, Associate at MHA. 1992.Martin. “Medicaid’s Role in Moves Toward Universal Health Care.” Policy Studies Review, Winter 1992, Volume 11. [Mardjuki]

There are major inequities in the way the states confer benefits and eligibility. In 1981, over 80 percent of the poor received Medicaid coverage in Hawaii, Michigan, California and Wisconsin, while under 25 percent of the poor received Medicaid coverage in Wyoming, Idaho and South Dakota. There were also considerable differences in the number of services provided by the states ; some provided almost all the 32 services permitted by federal legislation while others provided little more than the minimum six mandated by federal legislation (Cromwell, Hurdle and Schurman, 1987). All Medicaid programs must cover individuals receiving Supplementary Security Income (SS!) and Aid to Families with Dependent Children (AFDC>. In 1987, 551 recipients were responsible for 73 percent of Medicaid costs, while AFDC children under the ages of 21 were responsible for only 12.3 percent of Medicaid costs. The largest expenditures are for disabled 551 recipients, whose numbers have risen steeply in recent years (from 2.4 million in 1975 to 3.3 million in 1987). Over the same period, the total number of Medicaid eligibles has risen only moderately (by 6 percent). While AFDC recipients' per capita costs actually fell, 551 recipients' total costs soared from $3 billion to $17 billion (Howell, Andrews and Gornick, 1988). Some recipients fare exceptionally badly. Infants born to Medicaid recipients have been very poorly served (Rosenbaum, Hughes, Butler and Howard, 1988). Private providers are unwilling to treat pregnant beneficiaries. Medicaid's funding levels for prenatal services until recently were very inadequate; not all necessary services are covered by state programs, and the quality assurance mechanisms are poor (Alan Guttmacher Institute, 1988). The infants of women without adequate prenatal care are twice as likely to need intensive care as the infants of women who do receive adequate prenatal care (Munninger, 1985). Another group that suffers greatly are individuals with developmental disabilities. Many are inappropriately institutionalized and denied access to appropriate care in their home communities (Smull, 1989). The result of all this is, in the words of the United States General Accounting Office, "pervasive horizontal inequity-similar people in similar circumstances but in different states ... treated unequally in terms of both Medicaid eligibility and generosity of benefits" (U.S. General Accounting Office, 1987).

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Medicaid Bad

Public perception of Medicaid destroyed by years of fraud and criminal activity.De Alteriis, Associate at MHA. 1992.Martin. “Medicaid’s Role in Moves Toward Universal Health Care.” Policy Studies Review, Winter 1992, Volume 11. [Mardjuki]

Medicaid is tainted by extensive fraud and abuse. Many of the providers who do see Medicaid recipients appear to have target incomes (e.g., Evans, 1974) which they achieve-despite the low fees-through a variety of questionable practices. For example, some physicians perform tests or prescribe drugs that are not required, refer recipients to networks of specialists even though specialist care is not required and direct recipients to particular ancillary providers, such as pharmacies, in which they have an interest (U.S. Congress, 1977). Rice and Labelle (1989) found that states' efforts to reduce Medicaid physician fees merely led to an increase in these sorts of practices by the physicians who remained in the program (but see Feldman and Sloan, 1988). Finally, criminal activity plagues the program. Major scandals inNew York state have involved pharmacists that supplied controlled substances to eligibles for "kickbacks," and podiatrists who colluded with shoe stores to prescribe ordinary sneakers as "prescription footwear" (c.g.. de Alteri is, 1988). In the worst scenarios, "phantom" providers, created by skillful con artists, bilked Medicaid for millions of dollars of utterly nonexistent services (Cryta, 1986). The bad publicity from a succession of scandals across the nation has damaged the Medicaid program, increasing the stigma which deters both providers and eligibles.

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Reform Must Start With Medicaid

Medicaid reform must be considered in the context of massive healthcare restructuring – Medicaid is the starting point of effective reform.De Alteriis, director of Medical Health Administration. 1992.Martin. “Medicaid’s Role in Moves Toward Universal Health Care.” Policy Studies Review, Winter 1992, Volume 11. [Mardjuki]

Proposals for reform are usually combined into packages. One package designed to increase Medicaid eligibility and control costs would make poverty the sole criterion for eligibility and rely on managed care to contain costs (Oberg and Polich, 1988). A more radical package would divide the acute care and long-term care components of Medicaid, make poverty the criterion for eligibility, block grant long-term care and change the federal funding formulas for acute-term care (Holahan and Cohen, 1987). These reforms always have several desirable goals, such as increased or equalized coverage, but they do not consider Medicaid reform in the context of radical reform of the American health care system. This is a mistake. While the proposals could lead to some improvements in Medicaid, major problems would remain unsolved . The Medical Assistance program is greatly affected by the actions of other health care programs. If private insurers raise physicians' fees in a state, more physicians will see private patients and fewer will see Medicaid eligibles. If a change in the Medicare program's reimbursement ra tes lowers hospital profit margins, this will likely affect Medicaid recipients. If Medicaid inpatient rates are relatively low, hospitals will probably try to decrease the number of Medicaid recipients they admit (or their lengths of stay in the hospital) and attract more privately insured patients to compensate for the lost Medicare revenue. If the Medicaid inpatient rates are relatively high, the hospital will probably try to increase the number of Medicaid recipients they admit (or their lengths of stay in the hospital) to recoup the lost Medicare revenue, Most of Medicaid's problems can be traced to the principles which characterize the program. Medicaid is a welfare benefit -not a right-to be granted by the states, at their discretion. Consequently, horizontal inequities are not surprising. Medicaid must compete in a health care system run by market forces. As the payer of the last resort, offering the lowest reimburse must be expected. Only by changing these principles and combining Medicaid reforms with major structural reforms of American health care system can Medicaid's problems be solved. In the process, the nation's health care system could be transformed. For just as surely as Medicaid reform proposals that ignore the nation's health care system as whole will have limited success, so proposals to reform the nation's health care that do not fully consider Medicaid will have a less positive impact than they otherwise might . If affordable universal coverage is our goal, there is a logic to starting with the reform of the Medicaid program. Medicaid already covers a large proportion of the poor and uninsurable. As it is a government program, its reform will not threaten the private health care industry. We have a solid body of research specifically about Medicaid to guide us. Furthermore, we can also draw on research into the Medicare program and into other nations' public health care systems. If we take this approach, we should include the following elements in our reforms.

Least politically contentious way of restructuring healthcare is by reforming Medicaid.De Alteriis, director of Medical Health Administration. 1992.Martin. “Medicaid’s Role in Moves Toward Universal Health Care.” Policy Studies Review, Winter 1992, Volume 11. [Mardjuki]

Ultimately, health care reform should focus on values and priorities. The rhetoric in the 1992 presidential campaign focused primarily on cost containment so that middle Americans could be ensured adequate coverage and the budget deficit could be reduced. Expanding health care coverage sometimes seemed to be a secondary concern. If health care is considered a benefit, which would be nice to extend to every citizen but which we cannot afford to do, then reform of the American health care system might not benefit current Medicaid recipients and might not reach all of those now uninsured. If health care is to be distributed by market principles, then the poor will always have limited access and an inferior quality of care. On the other hand, if it accepted that basic health care is a right, akin to life, liberty and the pursuit of happiness, then widespread change is required . If health care is a basic right, then the federal government would be obliged to guarantee it. We need to stress the moral and legal imperatives rather than the need to control costs if we are to implement policies that would involve a high degree of redistribution. However, we also need to recognize the political realities of the day. Most privately insured Americans are content with their own health plan, even if they are discontent with the system as a whole. The health care industry is extremely powerful. Government intervention is looked upon far less favorably in the United States than in Europe and Canada. Bearing all that in mind, we should start by reforming existing government programs, most notably Medicaid, and take that route toward achieving our objectives.

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Medicare Spill Up

A Medicare structure can be modeled on a larger scale Dr. William R. Brody, 13th President of Johns Hopkins, 6-13-2003, “Is Medicare Cost Effective?”, http://www.hopkinsmedicine.org/about/Crossroads/06_13_03.html

Moon argues somewhat convincingly that Medicare has been a success. While not necessarily denying that certain reforms might be needed, she stresses the importance of preserving three essential tenets of the program:1. Its universal coverage nature creates the ability to redistribute benefits to those who are neediest.2. It pools risk in order to share the burdens of health care among the healthy and the sick.3. Through Medicare, the government protects the rights of all beneficiaries to essential health care.It has been argued that, in part, Medicare's cost effectiveness arises from the fact that it does not need to expend funds on marketing and sales-functions that are obligatory for the success of competitive, private-sector health plans. Moreover, some argue that the competitive model for health insurance has not been successful. In a market-driven economy, the healthy can and will change health plans for savings of only a few dollars a month, while the sick must remain in their existing plan in order to retain their physicians. Such behaviors lead to asymmetric risk pools and cost inequities.This was all sobering news to a market-driven entrepreneur such as yours truly. However, given the perverse incentives that frequently drive behavior in health care, my take-home lesson is that there are examples in the success of Medicare we can apply to other sectors of our population.

Medicare was designed as a basic model for eventual spilloverTheodore R. Marmor and Gary J. McKissick, Professor of Public Policy and Management at Yale and Professor of Political Science at Yale, 2K, “Medicare's Future: Fact, Fiction and Folly”, http://www.lexisnexis.com/us/lnacademic/results/docview/docview.do?docLinkInd=true&risb=21_T7030952640&format=GNBFI&sort=BOOLEAN&startDocNo=1&resultsUrlKey=29_T7030952644&cisb=22_T7030952643&treeMax=true&treeWidth=0&csi=7405&docNo=3

The claim that Medicare's "popularity" is not only "overwhelming" but "well deserved because the program has achieved all its designers' major objectives" n111 is  [*240]  clearly contestable. The authors cite no evidence to support their claims about the breadth and depth of the public's views. n112 While the work of Larry Jacobs and other public opinion scholars establishes that Medicare is broadly approved, that same work undercuts the easy connection between knowledge of the program (especially the extent to which objectives are understood to have been satisfied) and the support for the program. n113 To the extent Medicare is broadly popular, that support mostly reflects relatively superficial understanding of Medicare's role in helping America's elderly with large medical expenses. Other than that, the public is largely uninformed. n114Nor can it be the case that the public is satisfied because the major objectives of Medicare's designers' have all been achieved. That, of course, is one of the major conclusions of the program's history we have sketched: the key objective of expansion has not been achieved. n115 The original hope was that Medicare would grow into universal health insurance, not coverage only for the elderly, the disabled, and those suffering from renal failure . n116

Moreover, the reformers anticipated that Medicare would largely remove financial fearfulness from the lives of older Americans facing sickness, injury and other medical burdens. n117 That, as Marilyn Moon and others have amply demonstrated, has not been accomplished and for a variety of reasons . n118 Since the claims are factually false, so are the causal connections.Moreover, if the factual claims about politically relevant factors are questionable, the "implications" drawn are equally suspect. None of them are "straightforward" in the sense that reasonable analysts could not find grounds for questioning their normative plausibility or predictive accuracy. Consider one claim where the grounds for objection are quite obvious: the assertion that "congressional reforms will - and should - bring Medicare more in line with the structure of health care financing and delivery that is evolving to serve the non- Medicare population ." n119

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Slow Phase In Key – Medicare & Australia Prove

Medicare creation proves – selection of single model and slow phase-in is only viable option.Borosage, prof of law @ American University, Hickey, vice president @ Economic Policy Institute. 2001.Robert and Roger. The Next Agenda: Blueprint for a New Progressive Movement. Pg 116-117. [Mardjuki]

A related lesson is that although it may be necessary to respond to short-term political and economic constraints , it would be foolish to focus on short-term strategies to the point of abandoning long-term aims. The debate over Medicare is instructive. From the time the idea was first conceived, it took fifteen years of political struggle before federal health insurance for the elderly was adopted. Medicare’s political sponsors accepted incremental steps that they believed would not detract from their ultimate goal; but they never abandoned the campaign for Medicare. American politics, with its individualistic focus and shifting coalitions, tends to prompt short-term visions and encourage impatience. Yet one clear option for reformers is to reject these pressures by agreeing on a single programmatic model and legislative goal, and to begin a long-term political campaign to secure eventual enactment. As with Medicare, this will require patience, time to build and maintain a coalition, and the commitment to absorb defeat. In the short run this may be a painful route; over the long haul it may prove the most rewarding.

Phasing in means the plan saves hundreds of billions of dollarsFoster 94Catherine Foster, Staff writer of The Christian Science Monitor “Australians Offer US Tips on Health Care” lexis-nexis [LO//AS]

AS the United States Congress wades deeper into the difficult debate over reforming the nation's health care, it might want to take a look down under. Australia went through a similar experience in the 1970s. It had a system similar to the present American system, and faced the same difficult issues of reform. ''We had very tough political obstacles to get around,'' says Peter Botsman, executive director of The Evatt Foundation, a liberal think tank here. ''The doctors managed to change the Constitution so they couldn't get conscripted into a national health service. They closed down one state's [New South Wales] hospital system for seven months and refused to work.'' Dr. Botsman, who has written a national health-insurance strategy for the US, travels frequently to Washington to clarify misconceptions about the Australian system. ''My message for the US is that you can have a single-payer system with choice, diversity, and cost containment that satisfies all consumers' needs about health care,'' Botsman says. ''And you can have a private hospital system and a private health insurance system coexisting alongside a dominant single payer.'' Australia's 12-year-old universal health insurance system is funded by a flat 1.5 percent levy on gross income over A$ 10,000 (US$ 7,100) for singles, as well as through general revenue. Hospital care is free, as are most physician visits; pharmaceuticals are subsidized. Costs are set by the government, but it does not limit what doctors can charge. Low-income earners and pensioners hold a health card that entitles them to additional services. Safety nets ensure that out-of-pocket spending is capped. Medicare customers can choose their own physicians on a daily basis. Costs have been consistently held to 8 percent of GDP, says Lesley Russell, manager of public affairs for the drug company Merck, Sharpe & Dohme. Health care costs in the US account for 14 percent of GDP, and are expected to rise to 19 percent within five years, she notes. Botsman says the cost comparisons alone are dramatic: Administrative costs in Australia in 1987 were US$ 19 per capita; in the US they were $ 95. ''If you phased in the Australian system over eight years,'' he says, ''the US would save between US$ 891 billion and $ US3 trillion.'' And, he says, allaying US fears about a bloated and intrusive bureaucracy, the Australian health insurance system is only concerned with the monitoring of costs and ensuring that payments are made promptly, not with the actual delivery of services. Australia's reform process took years, starting in 1972. Along the way, a conservative government scrapped the program and another liberal leadership started over with a new one. ''It's kept costs under pretty tight control. That raises some conflict with doctors and with private hospitals,'' says John Deeble, health services fellow at Australian National University in Canberra, who helped design the 1973 and 1984 programs.

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Medicare Subsume Medicaid?

Successful healthcare reform requires Medicare to subsume Medicaid to slash costs through economics of scale.De Alteriis, director of Medical Health Administration. 1992.Martin. “Medicaid’s Role in Moves Toward Universal Health Care.” Policy Studies Review, Winter 1992, Volume 11. [Mardjuki]

The starting point for our plan would be the merger of Medicaid and Medicare. This would create a very large program that could use its market share to control costs and ensure access. If the uninsured were added to this program, the proportion of the total health care market covered by the new program would rise still further. To set a good example, we might insist that all public servants (and their families) in federal, state and local government be covered by the public plan. Private individuals and employers could buy into the program at any time. The volume of business that could be granted to approved or preferred providers would increase the program's ability to negotiate with the health care industry. It should improve the average public health care recipient's access to quality care and help control overall costs. To ensure that horizontal inequities are removed, the federal government should administer the public health plan, Federal control would also help ensure that the new program fully utilized the advantages of its large market share.

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Medicaid Expansion KeyBuilding upon Medicaid would be a great way to expand healthcare. Rowland, Lyons, and Rudowitz ’09 (Diane Rowland, PhD, Vice President, Kaiser Family Foundation; Deputy Director, Kaiser Commission on Medicaid and the Uninsured, Washington, DC Co Chair, Barbara Lyons MPA, ScD, Executive Vice President, Henry J. Kaiser Family Foundation, Executive Director, Kaiser Commission on Medicaid and the Uninsured, Washington, DC, and Robin Rudowitz Principal Policy Analyst, Kaiser Commission on Medicaid and the Uninsured, Washington, DC, 5-09, the Kaiser Commission on Medicaid and the Uninsured, “Medicaid As A Platform For a Broader Health Reform: Supporting High-Need and Low-Income Populations”)

As debate on national health reform moves forward, expanding coverage to the uninsured as well as addressing health care cost and quality issues have emerged as the dominant drivers for system reform. Extensive research shows that coverage is key to securing access to needed health care services. Leading health reform proposals rely on a combination of public and private approaches to expand coverage, control costs and improve quality with shared responsibilities across employees, employers, government, consumers and insurance markets. What problems do low-income individuals face in today’s health care system? • Two-thirds of the 45 million uninsured are low-income individuals (below 200% of the poverty level or $36,620 for a family of three in 2009), and many have significant health needs. • Many low-income individuals do not have access to employer coverage and cannot afford or access private coverage through the individual market. Why build on Medicaid? Medicaid already serves 60 million Americans and provides a base of affordable and comprehensive coverage that is well suited for low-income and high-need populations. The costs of private health care and Medicare premiums are lessened by having Medicaid insure these highneed populations and provide key services not covered by private plans or Medicare. • Most Medicaid enrollees receive care through private managed care plans that are designed to promote access to care, enhance quality and control costs. Medicaid also helps support community health centers and other safety-net providers in medically underserved areas. • Medicaid enrollees fare as well as the privately insured populations on important measures of access to primary care even though they are sicker and more disabled. Accounting for the health needs of its beneficiaries, Medicaid is a low-cost program with lower per capita spending than private insurance; thus covering Medicaid enrollees in private coverage would be more costly. • Medicaid has a well developed administrative structure in every state that has enabled it to be a cornerstone in federal and state efforts to expand coverage . Medicaid plays an important role for some disadvantaged populations and the program has broad public support . How can Medicaid be a stronger platform for health reform? • Expand Medicaid’s reach to more low income individuals by basing eligibility on income alone with federal minimum standards and making additional progress to increase participation rates. • Ensure that current and new enrollees receive Medicaid’s benefit and cost-sharing protections, and promote better access by addressing payment rates to help boost provider participation. • Provide adequate Medicaid financing by having the federal government assume the costs of expanding Medicaid coverage or by shifting some current Medicaid costs to the federal government; and provide stable financing by establishing a countercyclical financing mechanism during economic downturns. • Bolster Medicaid with broader efforts to contain costs across the health system (public and private) to help ensure long term sustainability; develop strategies to expand the primary care workforce to provide better access to primary and preventive care, and establish system-wide quality standards along with the implementation of health information technology to promote an efficient health care system based on positive outcomes. Health reform will not address all the gaps in the health care system that Medicaid now helps to fill such as providing long-term care and helping to sustain the health care safety-net and covering many of the supportive services that the chronically ill and disabled need. As we move forward, Medicaid offers a strong foundation on which broader health reforms can be built by providing coverage for the high-need and low-income populations and providing a vehicle to reach more low-income uninsured with affordable coverage. This strong foundation will help to assure the success of larger health reform efforts.

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**SOLVENCY**

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Low-Income Uninsured Coverage Needed

Low-income families form a disproportionate amount of the uninsured – successful health care reform provide them with coverage.Tumulty, national political correspondent. 7/21/09.Karen. “Medicaid and the States: Health-Care Reform’s Next Hurdle.” Time Magazine. http://www.time.com/time/politics/article/0,8599,1911856,00.html [JM]

Douglas Elmendorf, head of the Congressional Budget Office, has testified that the legislation thus far has too little cost containment. Senators of both parties are trying to put the brakes on the President's drive to have bills passed by the House and Senate by the August recess. Republicans are calling it a dangerous "experiment." And even the Mayo Clinic — often cited by Obama as the model of what an efficient, high-quality health-care system should look like — is cautioning on its blog that legislation under consideration in the House "misses the opportunity to help create higher quality, more affordable health care for patients. In fact, it will do the opposite." Medicaid has become the latest sticking-point issue in health reform because of the daunting challenge of how to cover those most likely to find themselves without health coverage. Low-income adults — those who earn under 200% of poverty, or $33,200 for a family of four — account for about half the uninsured in this country. Under the current rules, many of them are not eligible for Medicaid, which was established alongside Social Security in 1965 to cover low-income children, their parents, the poor elderly, the disabled and those in need of nursing-home care. (Read "Cost, Not Coverage, Drive Health-Care Debate.") What Congress is now considering is whether to make income alone the determinant of Medicaid coverage. Under the health-reform bill now being considered by the House, all non-elderly people earning at or below 133% of poverty — about $14,400 for an individual and $29,300 for a family of four — would be eligible. The House bill would have the Federal Government pick up the entire cost for those newly covered under Medicaid — $438 billion over 10 years. But a draft proposal by the Senate Finance Committee would have the feds paying the additional cost for only five years, after which the states would have to pick up their typical share of existing Medicaid costs, which averages over 40%. The Congressional Budget Office predicts that the House proposal would add 11 million to the Medicaid rolls, accounting for about a third of the estimated 40 million uninsured Americans who would gain health insurance under the proposal. But there are real questions as to whether the program could handle the strain of that many new clients. Already, it is difficult in some areas to find health-care providers who are willing to accept Medicaid patients. Governors warn that unless they increase the amount that Medicaid reimburses doctors and hospitals — and, with it, the cost of the program — the supply of providers will not come close to meeting the demand for medical services. (Watch a video on uninsured Americans.) The argument in favor of expanding Medicaid is largely one of efficiency. The existing program "is designed to meet the needs of low-income individuals and those with complex health needs and has an existing delivery, financing and administrative structure," says the nonpartisan Kaiser Family Foundation. "Medicaid coverage for low-income adults could help establish a strong floor of coverage for the low-income population, upon which additional expansion efforts could build."

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Solvency – Medicare Based System Solves

A healthcare system structured off of Medicare solves – relieves state budgets, extends coverage, and cuts costs.Miller, RN and MSN @ Ball State University. 1993.Anna, “Health Care Reform: Clarifying the Concepts.” Journal of Community Health Nursing, Volume 4, Pgs. 199-211. [Mardjuki]

A new single-payer system could be designed for the entire population. Alternatively; existing governmental health insurance programs could be modified and expanded to provide insurance coverage for specific population groups. Expansion of existing public programs might be more politically acceptable than establishing completely new programs (Harrington, 1990). Expand Medicare to everyone. The existing single-payer Medicare system could be expanded to include everyone, adding preventive, perinatal, and well child care. Everyone would have a medical identification card (like a Medicare card), copayments and deductibles would be reduced for low-income persons, and there would be no charge for most preventive services. Private insurance systems could insure for services not covered by this single public plan. Expand Medicare to special populations. Rather than including everyone, special groups that now lack health insurance could be added to Medicare , such as all children under 18, single adults, or persons of all ages with disabilities. Adding children to Medicare would provide coverage for the 43010 of all children who now are uninsured (Friedman, 1991). Children are relatively inexpensive to insure, and their improved health brings societal benefits over many years. Public universal coverage for children also would reduce employers' costs for family coverage and help expand employer-based insurance. Expand Medicaid. Low-income persons could be added to the existing federal-state Medicaid program. Everyone living in families at or below 100% or 150% of the federal poverty level could automatically be included, and low-income persons above the poverty line could buy into the program on an income-related sliding scale. This incremental approach would build on recent Medicaid expansions, such as home-care waivers and expanded coverage for low-income pregnant women and children. Adding low-income persons could provide work incentives for welfare recipients because becoming employed would no longer mean losing Medicaid benefits. A Medicaid expansion could include mandatory enrollment in managed care through health maintenance organizations (HMOs) or Preferred Provider Organizations (PPOs), which would decrease costly overutilization of emergency rooms by guaranteeing access to primary care. On the negative side, low-income uninsured persons might not be able to afford to buy into the Medicaid program. Because states pay up to one half the Medicaid expenditures, mandated Medicaid expansion could also be very costly for the states, especially states with historically narrow Medicaid eligibility and low serviceprovision levels. Politically, some states that provide more generous benefits might have difficulty reducing benefit levels and/or restricting eligibility. Federalize Medicaid . Changing Medicaid from a combined state-federal program to a federal program like Medicare would provide uniform eligibility and benefits across all states, increase administrative efficiency, and expand access to vulnerable populations. This approach would relieve states of escalating Medicaid costs and allow states to focus on funding long-term care. It also has the negative potential of increasing federal budget deficits. Expand Medicare and replace Medicaid. Rather than continuing two publicly funded health insurance programs, another incremental approach is to expand the present single-payer Medicare program to include low-income and uninsured persons, thus eliminating Medicaid. Medicaid expenditures have escalated more rapidly than other health care sectors, benefits and eligibility vary greatly and contribute to high administrative costs, and public perception is one of a second-class system. Medicare, by contrast, is highly popular with constituents, has fairly effective cost control mechanisms, and reports low administrative costs. On the negative side, this approach would not include the millions of uninsured who are noneligible for either Medicaid or Medicare.

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Squo Reform Fails – Need Single-Payer

Only a single-payer system mitigates costs – Medicare proves. Schoonmaker, Global Sourcing Finance Chief at GE Healthcare, 7/20/09Anne. “Why not singlepayer?” Baltimore Sun. http://www.baltimoresun.com/news/opinion/readersrespond/bal-ed.le.letters200jul20,0,1114455.story [Mardjuki]

In a Q-and-A recently posted on the Web site Crooks & Liars (http://crooksandliars.com/node/29667), House Speaker Nancy Pelosi responded to one of the questions by saying, "For 30 years I have supported a single-payer plan, but our next best choice is to support an exchange and a public option." The question that her response prompts from me is, why are we giving up on the best solution and settling for something that, from all appearances, is a whole lot less than "next best?" The House plan is not set to go "live" until January of 2013 . No, that is not a typo. If I told you that in less than a year after the historic Medicare legislation was signed into law, the program was up and running, and millions of older Americans had been enrolled and were getting health care with hardly a hiccup, wouldn't you wonder why it's going to take so long to get essential elements of this version of reform in place? Wouldn't you wonder why the elements that are designed to help the millions of uninsured are the ones that are going to take the longest to implement? Or, maybe, you wondered if there's a political reason why the plan won't be fully operational until 2013, like the fact that we will have a presidential election in November of 2012, and it might not be good for the fortunes of the current president or the senators and representatives up for re-election if a new health care system is not going well or is not all it was advertised to be. So, what will the millions of currently uninsured people do between now and 2013? And, with an economy in decline, thousands of people losing their jobs every month and losing their coverage, with more employers changing to plans that cover less and cost the individual more, or dropping coverage altogether, how much more dire will things be in four years? What will the insurance companies be doing between now and 2013? How will they be positioning themselves to accommodate the changes that are coming? What will we see from them in the next 3 1/2 years that will signal they have even the slightest interest in improving our access to and delivery of actual health care? What this is really all about, where the focus should have been from the start, is health care, not insurance. Having a shiny new insurance policy will not help if the out-of-pocket costs are such that people still cannot afford to see the doctor or get the medications they need. All of the major developed nations have some form of single-payer health care. Their spending per-person on health care is less than half what we spend here, and their people are, by most accepted measures, healthier than we are . Why are we writing 1,000-plus-page bills, creating a Rube Goldberg -ian system whose biggest benefit will be to insurance companies that have done nothing in the last several decades to improve the current system - but a lot to assist the political careers of more than a few members of Congress who are crafting this "reform" (and making those who need accessible and affordable care the most wait the longest to get it) - when we have a single-payer model, Medicare, that we know works well and could be expanded or duplicated with relative ease and in a much shorter period of time?

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Squo HC FailsThe Current Health Care System SucksHimmelstein, dept Medicine Harvard, and Woolhandler, MD + MPH, ‘07(David U. Himmelstein, MD; The Department of Medicine at Cambridge Health Alliance/Harvard Medical School, and Steffie Woolhandler, MD + MPH + Physicians for a National Health Program of Chicago, 11/07, “Our Health Care System at a Crossroads: Single Payer or Market Reform?” www.pnhp.org/news/2008/may/our_health_care_syst.php) [LO//JW] 

Almost all agree that our health care system is dysfunctional. Forty-five million Americans have no health insurance, resulting in more than 18,000 unnecessary deaths annually according to the Institute of Medicine [1]. Tens of millions more have inadequate coverage. Health care costs will reach $7498 per capita this year, 50% higher than in any other nation, and continue to grow rapidly. Market pressures threaten medicine’s best traditions. And bureaucracy overwhelms both doctors and patients. Opinion on solutions is more divided.Discussion of health reform was muted in the 1990s after the defeat of President Clinton’s Byzantine scheme for universal coverage. But now, the accelerating collapse of employment-based coverage under the pressure of globalization is reopening debate. Firms like General Motors (GM) and Ford are crippled by the growing burden of health costs, which add $1500 to the price of a GM car versus $419 for a German Mercedes and $97 for a Japanese Toyota [2]. Meanwhile, low-wage employers like Wal-Mart gain competitive advantage by purchasing goods made overseas (where health benefit costs are low) and offering only the skimpiest of health coverage to their US workers. Governments face a double whammy: ever-expanding benefit costs for their employees (eg, teachers, firemen, and police) as well as sharply escalating costs for public programs such as Medicaid and Medicare.

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Single Payer Solves - Waste

Single-payer reform more efficient - eliminates duplicative bureaucracy.Marshall, George Polk Award winner, chief reporter, July 15, 2009. Joshua. “The case for keeping “single payer health care” off the table.” Talking Points Memo. http://tpmcafe.talkingpointsmemo.com/talk/blogs/jpieterick/2009/07/the-case-for-keeping-singe-pay.php?ref=reccafe [Mardjuki]

Having first identified health care reform as a critical issue confronting the U.S., American health care consumers have looked around at other industrialized nations and see single payer systems that are serving all their constituents at less cost per person than our present system. Without even getting into the specific details of how these other programs work, the American health care consumer is able to determine intuitively that there are a number of ways in which a single payer plan can introduce efficiencies that result in real savings over present costs. To begin with, there is an intuitive sense that a single administration overseeing a universal plan is surely far more efficient than a multitude of private corporations establishing their own bureaucracies to manage their own little corner of the comprehensive system that is required. Duplication of services is understood to be extensive and extremely wasteful, as is the number of people needed to simply keep up with the myriad of different bookkeeping and other paper trails that are created, generally as one whole system of paperwork and policies, etc., per provider. These same consumers understand that it will take one CEO - a government Administrator, probably at the level of a Cabinet Secretary - to oversee a singular bureaucracy in charge of providing universal health care to all. This CEO will be expected to earn in the neighborhood of $197,000 (Highest rate now paid to any Cabinet Secretary) and will replace an untold number of private executives, each making multiples of this salary. Multiples of $197k? Well, yes. It was recently reported, for example, that Bill McGuire, former CEO of UnitedHealth Group, accumulated total compensation of $1.6 billion during 2005. Quickly doing the math, the consumer reasons that simply removing this one executive from the equation for one year provides enough financial resources to provide lifetime health care coverage for themselves and their extended family, almost without regard for how large that family might be. Eliminating all such highly paid executives could be expected to result in enormous savings without compromising so much as the availability of a single visit to a Doctor.

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Single Payer Solves – Waste & Patchwork

Single Payer solves – eliminates patchwork systems of administrative waste.PNHP 2009.Physicians For A National Health Program. “Single Payer Resources.” http://www.pnhp.org/facts/single_payer_resources.php [Mardjuki]

The reason we spend more and get less than the rest of the world is because we have a patchwork system of for-profit payers. Private insurers necessarily waste health dollars on things that have nothing to do with care: overhead, underwriting, billing, sales and marketing departments as well as huge profits and exorbitant executive pay. Doctors and hospitals must maintain costly administrative staffs to deal with the bureaucracy. Combined, this needless administration consumes one-third (31 percent) of Americans’ health dollars. Single-payer financing is the only way to recapture this wasted money. The potential savings on paperwork, more than $350 billion per year, are enough to provide comprehensive coverage to everyone without paying any more than we already do. Under a single-payer system, all Americans would be covered for all medically necessary services, including: doctor, hospital, preventive, long-term care, mental health, reproductive health care, dental, vision, prescription drug and medical supply costs. Patients would regain free choice of doctor and hospital, and doctors would regain autonomy over patient care. Physicians would be paid fee-for-service according to a negotiated formulary or receive salary from a hospital or nonprofit HMO / group practice. Hospitals would receive a global budget for operating expenses. Health facilities and expensive equipment purchases would be managed by regional health planning boards. A single-payer system would be financed by eliminating private insurers and recapturing their administrative waste. Modest new taxes would replace premiums and out-of-pocket payments currently paid by individuals and business. Costs would be controlled through negotiated fees, global budgeting and bulk purchasing.

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Single Payer Solves – Bureaucracy

Less overhead costs and decreased bureaucratic costs of $100 billion a year mean that the plan makes single-payer cheaper and more effectiveSymonds 94William C. Symonds director of the Forgotten Half Project education program at Harvard “WHITHER A HEALTH-CARE SOLUTION? OH, CANADA” Business Week SOCIAL ISSUES; Number 3363; Pg. 82 lexis-nexis [LO//AS]

LESS OVERHEAD. For U.S. business, the predominant concern should be controlling runaway spending on health care . This year, the U.S. will devote 14% of gross national product to health care: at least 40% more than Canada, Japan, or the European Community. Even so, the U.S. ranks below many of these nations in life expectancy and infant mortality. By combining huge administrative savings with caps on national health spending, the single-payer approach has the potential in the long run to cut spending more than any other plan. Under the leading single-payer proposal, sponsored by Representative Jim McDermott (D-Wash.) and 92 other House Democrats, the government would become responsible for virtually all medical bills, including prescription drugs, mental-health treatment, and long-term nursing-home care. A few frills -- such as private hospital rooms -- would not be covered. As in Canada, the government would pick up the entire tab for covered procedures. No other plan is as generous. McDermott would finance all this with stiff federal tax increases, which would be offset by a steep decline in insurance premiums. Businesses with more than 75 workers and wages averaging more than $ 24,000 per employee would face an 8.4% payroll tax. Smaller businesses would pay 4%, while individuals would pay 2.1%. But taxes would probably have to be even higher. In addition, McDermott would increase the federal cigarette tax to $ 2 a pack from 24 and impose a new 50% excise tax on handguns and ammunition. Ultimately, McDermott estimates, 75% of Americans would pay less than they do now for coverage. By 2003, the savings would amount to about $ 1,000 a year per family. Critics challenge some of McDermott's projections. But single-payer will do the most to eliminate much of the bureaucracy that has become the plague of American medicine. Thanks to the paperwork and complexity of private insurance, some 24% of the nation's health-care spending now goes to administration, compared with only 11% in Canada. Yet the CBO estimates that the single-payer system would trim overhead by up to $ 100 billion a year -- enough to provide coverage for 40 million uninsured Americans. For consumers, single-payer offers equally compelling advantages. It would grant every legal U.S. resident full coverage starting in 1997, while many of the alternatives would continue to leave millions uninsured. Single-payer would also allow consumers to choose a doctor without paying higher premiums or extra charges for this fundamental privilege. Thanks to the proliferation of managed-care plans, this freedom is increasingly being constrained. "Single-payer provides the best assurances that patients would be able to seek care from any doctor of their choice," says Dr. David Murray, chairman of the American College of Surgeons. That group's stand shocks many observers, since under single-payer the states would negotiate fee schedules with physicians, effectively capping their income. But most managed-care plans also limit doctors' income. The difference is that under single-payer, physicians would have more freedom to order necessary medical services without the constant second-guessing and micromanagement of managed care.

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Single Payer Solves – Medical Consensus

Medical community consensus – only single payer system solves.Angell, MD, Editor of New England Journal of Medicine, Senior Lecturer @ Harvard Medical School, 2009.Marcia, Quentin Young, American Public Health Association, Joel Alpert, American Academy of Pediatrics, Ron Anderson, CEO Parkland Health System, Peter Beilenson, Commissioner of Baltimore City Health, Christine Cassell, President of American College of Physicians. “Proposal of the Physicians’ Working Group for single-Payer National Health Insurance.” Physicians For A National Health Program. http://www.pnhp.org/single_payer_resources/proposal_of_the_physicians_working_group_for_singlepayer_national_health_insurance.php [Mardjuki]

We endorse a fundamental change in America’s health care - the creation of a comprehensive National Health Insurance (NHI) Program. Such a program - which in essence would be an expanded and improved version of Medicare - would cover every American for all necessary medical care. Most hospitals and clinics would remain privately owned and operated, receiving a budget from the NHI to cover all operating costs. Investor-owned facilities would be converted to not-for-profit status, and their former owners compensated for past investments. Physicians could continue to practice on a fee-for-service basis, or receive salaries from group practices, hospitals or clinics. A National Health Insurance Program would save at least $150 billion annually by eliminating the high overhead and profits of the private, investor-owned insurance industry and reducing spending for marketing and other satellite services. Doctors and hospitals would be freed from the concomitant burdens and expenses of paperwork created by having to deal with multiple insurers with different rules - often rules designed to avoid payment. During the transition to an NHI, the savings on administration and profits would fully offset the costs of expanded and improved coverage. NHI would make it possible to set and enforce overall spending limits for the health care system, slowing cost growth over the long run. A National Health Insurance Program is the only affordable option for universal, comprehensive coverage. Under the current system, expanding access to health care inevitably means increasing costs, a nd reducing costs inevitably means limiting access. But an NHI could both expand access and reduce costs. It would squeeze out bureaucratic waste and eliminate the perverse incentives that threaten the quality of care and the ethical foundations of medicine.

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Single Payer Solves – Dem Accountability

Canada proves – single payer system ensures democratic accountability.Borosage, prof of law @ American University, Hickey, vice president @ Economic Policy Institute. 2001.Robert and Roger. The Next Agenda: Blueprint for a New Progressive Movement. Pg 114. [Mardjuki]

The final option we want to discuss is what are conventionally referred to as “single·payer" plans—the model of choice for many reformers since the early 1980s. ln fact, Medicare itself is a single-payer plan in the sense that the insurance funds that pay for Medicare’s benefits are in a single program. The trouble with the term, however, is that it inadequately describes what most people who call for a single·payer plan re- ally want. The dominant model of a single-payer, comprehensive pub- lic health insurance program is Canada’s Medicare. There, the governing legislation prescribes broad physician and hospital coverage (“comprehensive care"), accessible terms (that is, no deductibles or co- insurance payments), public administration (for accountability), and portability (that is, coverage that protects Canadians whether they are in their home province or not).“ The appeal of such an approach is obvi- ous. Universal health insurance has been for most Canadians the coun- try`s postwar public triumph. lt has brought a decent level of medical care to the country’s citizens and consumes 40 percent less of the an- nual national income than is consumed by medical care in the United States. The necessary consequence of Canada’s methods of financing and cost-control-paying for medical care from each provincial budget, setting budgets for hospitals, and limiting what doctors and drug firms can charge—is ongoing controversy. There is continuous discussion about how much to spend, on what, for whom, and under what nnles of fairness of access or financing. There is also a democratic accountability that is truly astonishing when compared to the enormously frag- mented and hence less accountable decisionmaking process in the United States. A necessary corollary is constant media attention to Canada’s "sing]e-payer" program, featuring constant claims Canada's doctors and other medical occupations that "crises' are imminent or in full bloom. Canada°s Medicare system is more cost·efficient and more easily un-derstood than other altematives, and it places far fewer constraints on professional autonomy and patient choice than is the case within the current U.S. system.

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Single Payer Solves – Fair Wages

Single payer structure allows for fair practitioner compensation.Angell, MD, Editor of New England Journal of Medicine, Senior Lecturer @ Harvard Medical School, 2009.Marcia, Quentin Young, American Public Health Association, Joel Alpert, American Academy of Pediatrics, Ron Anderson, CEO Parkland Health System, Peter Beilenson, Commissioner of Baltimore City Health, Christine Cassell, President of American College of Physicians. “Proposal of the Physicians’ Working Group for single-Payer National Health Insurance.” Physicians For A National Health Program. http://www.pnhp.org/single_payer_resources/proposal_of_the_physicians_working_group_for_singlepayer_national_health_insurance.php [Mardjuki]

The NHI would include three payment options for physicians and other practitioners: fee-for-service; salaried positions in institutions receiving global budgets; and salaried positions within group practices or HM Os receiving capitation payments. Investor-owned HMOs and group practices would be converted to not-for-profit status. Only institutions that actually deliver care could receive NHI payments, excluding most current HMOs and some practice management firms that contract for services but don’t own or operate any clinical facilities. 1- Fee-for-service: The NHI and representatives of the fee-for- service practitioners (perhaps state medical societies) would negotiate a simplified, binding fee schedule. Physicians would submit bills to the NHI on a simple form, or via computer, and would receive extra payment for any bill not paid within 30 days. Physician payment would cover only the work of physicians and their support staff, and would exclude reimbursement for costly office-based capital expenditures for such items as MRI scanners. Physicians accepting payment from the NHI could bill patients directly only for uncovered services (e.g. for cosmetic surgery). 2- Salaries within institutions receiving global budgets: Institutions such as hospitals, health centers, group practices, migrant clinics, and home care agencies could elect to be paid a global budget for the delivery of care as well as for education and prevention programs. The negotiation process and regulations regarding capital payment and profits would be similar to those for inpatient hospital services. Physicians employed in such institutions would be salaried. 3- Salaries within capitated groups: HM Os, group practices, and other institutions could elect to be paid capitation premiums to cover all outpatient, physician, and medical home care. Regulation of payment for capital and profits would be similar to that for hospitals. The capitation premium would not cover inpatient services (except physician care) which would be included in hospital global budgets. Selective enrollment policies would be prohibited and patients would be permitted to disenroll with appropriate notice. HMOs would pay physicians a salary, and financial incentives based on the utilization or expense of care would be prohibited. The proposed pluralistic approach to delivery would avoid unnecessary disruption of current practice arrangements. All three proposed options would uncouple capital purchases and institutional profits from physician payment and other operating costs, a feature essential for minimizing entrepreneurial incentives, containing costs and facilitating health planning. The fee-for-service option would greatly reduce physicians’ office overhead by simplifying billing. Canada, and several European nations have developed successful mechanisms for reconciling the inflationary potential of fee-for-service practice with cost containment. These include: limiting the supply of physicians; monitoring for extreme practice patterns; setting overall limits on regional spending for physicians’ services (thus relying on the profession to “police” itself); and even capping individual physicians’ reimbursement. These regulatory options are not difficult (and have not required extensive bureaucracy) when all payment comes from a single source. Similar measures might be needed in the U.S. There might also be a concomitant cap on spending for the regulatory apparatus - eg. expenditures for program administration and reimbursement bureaucracy might be restricted to three percent of total costs. Global budgets for institutional providers would eliminate billing, while providing a predictable and stable financial support. Such funding could also stimulate the development of community prevention (eg. school-based smoking prevention programs) whose costs are difficult to attribute (and bill) to individual patients. Continuity of care would no longer be disrupted as patients’ insurance coverage changes due to retirement or job change. Incentives for capitated providers to skimp on care would be minimized since unused operating funds could not be diverted to profits or capital investments.

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Single Payer Solves – Drug Costs

Single payer system lowers drug costs – pressure on big pharma.Angell, MD, Editor of New England Journal of Medicine, Senior Lecturer @ Harvard Medical School, 2009.Marcia, Quentin Young, American Public Health Association, Joel Alpert, American Academy of Pediatrics, Ron Anderson, CEO Parkland Health System, Peter Beilenson, Commissioner of Baltimore City Health, Christine Cassell, President of American College of Physicians. “Proposal of the Physicians’ Working Group for single-Payer National Health Insurance.” Physicians For A National Health Program. http://www.pnhp.org/single_payer_resources/proposal_of_the_physicians_working_group_for_singlepayer_national_health_insurance.php [Mardjuki]

NHI would pay for all medically necessary prescription drugs and medical supplies, based on a national formulary. An expert panel would establish and regularly update the formulary. The NHI would negotiate drug and equipment prices with manufacturers, based on their costs (excluding marketing or lobbying). Where therapeutically equivalent drugs are available, the formulary would specify use of the lowest cost medication, with exceptions available in case of medical necessity. Suppliers would bill the NHI directly (for the negotiated wholesale price plus a reasonable dispensing fee) for any item in the formulary that is prescribed by a licensed practitioner. NHI could simultaneously address two pressing needs: (1) providing all Americans with full coverage for necessary drugs and supplies; and (2) containing drug costs. As a monopsony purchaser, the NHI could exert substantial pressure on pharmaceutical companies to lower prices. Similar programs in the U.S. and in other nations (e.g. Australia) have resulted in substantial savings. Additional reforms are urgently needed to: improve prescribing practices; minimize medication errors; upgrade monitoring of drug safety; curtail pharmaceutical marketing; assure that the fruits of publicly funded drug research are not appropriated for private profit; and ameliorate financial pressures that skew drug development.

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Single Payer Solves - Physicians

No discentive for physicians – decreased bureaucratic hoops and paperwork.Angell, MD, Editor of New England Journal of Medicine, Senior Lecturer @ Harvard Medical School, 2009.Marcia, Quentin Young, American Public Health Association, Joel Alpert, American Academy of Pediatrics, Ron Anderson, CEO Parkland Health System, Peter Beilenson, Commissioner of Baltimore City Health, Christine Cassell, President of American College of Physicians. “Proposal of the Physicians’ Working Group for single-Payer National Health Insurance.” Physicians For A National Health Program. http://www.pnhp.org/single_payer_resources/proposal_of_the_physicians_working_group_for_singlepayer_national_health_insurance.php [Mardjuki]

Physicians would have a free choice of practice settings. Treatment would no longer be constrained by the patient’s insurance status, nor by bureaucratic dictum. Fee-for-service practitioners would be paid promptly. The entrepreneurial aspects of medicine - the problems as well as the possibilities - would be limited. Physicians could concentrate on medicine; every patient would be fully insured, but physicians could increase their incomes only by working harder. Billing would involve imprinting the patient’s NHI card onto a slip, checking a box indicating the complexity of the encounter, and sending the slip (or electronic equivalent) to the physician payment board. This simplification of billing would save each practitioner thousands of dollars annually in office expense. Bureaucratic interference in clinical decision making would sharply diminish. Costs would be contained by controlling overall spending and limiting entrepreneurial incentives, obviating the need for the kind of detailed administrative oversight characteristic of current practice. Salaried practitioners would be insulated from the financial consequences of clinical decisions. Since savings on patient care could no longer be used for institutional expansion or profits, pressure to skimp on care would be minimized. Nurses and other personnel would enjoy a more humane and efficient clinical milieu. The burdens of paperwork associated with billing would be lightened.

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Single Payer Solves –Efficient

Single payer most efficient option for federal plan Prajwal Ciryamv, 9-5-2008, MD/PhD from Northwestern University, “A Market for Compassion: Single-Payer Health Insurance”, http://www.pubmedcentral.nih.gov/articlerender.fcgi?artid=2580082

In a single-payer system, the government will fund health insurance, but private providers will continue to deliver care. Economies of scale will save the money to make this possible. Many Americans, including Democratic presidential nominee Barack Obama, concede that single-payer insurance is probably our most efficient option.[2] But they worry that it lacks the spirit of the American market. Nothing could be further from the truth.A single-payer system will harness the market's strengths while addressing its limitations. The private health insurance market is inefficient, bloated by advertising, duplicated bureaucracies, dividends, and executive compensation. What's worse, insurance policies are so complex and individuals' future needs so unpredictable that consumers cannot make the informed selections that induce competition between insurers.However, consumers can create competition among healthcare providers. This is paramount because patients need the best healthcare, not the best middlemen to pay for it. Currently, providers are insulated from competition because private insurers often restrict coverage to select physicians. In addition, the 47 million uninsured Americans[3] have little impact on the market. A single-payer system will give all consumers the power of choice and open all healthcare providers to the effects of consumer decisions.Single-payer works because of the efficiency of specialization. The government will manage the paperwork and private entities will provide the care. Adam Smith would be proud.

Healthcare bill alternative plans weak compared to single payerCampus Progress, 7-19-2009, part of the Center for American Progress for college students, “A ‘Better than Nothing’ Future”, http://fundingourfuture.campusprogress.org/tag/single-payer-health-care/

Nothing is what some of these proposals seem to offer. The most significant omission in the leaked health care reform legislation from the Senate Finance Committee is the absence of the public option . In its place is the co-op proposal, introduced by Senator Conrad (D- N.Dakota). Mother Jones does a good job of summing up the ugly compromise:What is in the Finance Committee’s draft, and slated for further discussion, is a scheme for health care “co-ops” that would pool individuals and businesses together into consumer co-operatives to purchase health insurance and services. (Kaiser Health News has profiled one existing co-op in Seattle.) Baucus [Chairman of the Senate Finance Committee] has been talking out of both sides of his mouth on the public plan for some time, and seemed to quickly latch onto the co-op idea as means to having it both ways. Co-ops are a weak alternative to the public plan and have been tried before, after the Great Depression, and failed. We can’t afford weak alternatives. Congress should be writing the strongest proposals possible, but are instead releasing watered-down bills, drenched in industry money and influence, and all we can say is “well it’s better than nothing.” This is unacceptable. Our futures deserve better. For example, why not single-payer health care? Yes, Campus Progress, along with many other health care reform supporters, has been advocating for the public health insurance option that will provide quality, affordable health care for all. However, if single-payer health care were on the table it would be the more progressive plan to fight for.

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Single Payer Solves –Efficient

Despite concerns, single-payer health care assures coverage and timely access to careConyers, US rep, 6-10-09(John Conyers, Jr., US Representative on the Subcommittee on Health, Employment, Labor, and Pensions, June 10, 2009, Congressional Testimony, Lexis Nexis) [LO//JW]  Opponents of single-payer argue that scarcity of care and long waiting lines will inevitably occur in universal single-payer systems. The facts show otherwise. Waiting lines exist when government invests too little in the medical professionals and equipment that make up our health care infrastructure. It is true that Canada and the United Kingdom have had waits for elective procedures, but that is because they spend 60% and 33% less than we do on health care. Waiting lines do not exist in countries that adequately fund national health care. As long as health care is a priority for our nation, this problem will never materialize.Another argument utilized by those skeptical of single-payer reform is that we cannot afford a single-payer system where we insure every man, woman, and child in the United States. In fact, according Dr. Steffie Woolhandler of Harvard Medical School, implementing a single-payer system with non-profit delivery would save approximately $300 billion dollars per year and contain long- term costs. If we deliberately hold down costs with a cohesive and efficient public-private partnership, we can afford to provide true universal health care with the $2.5 trillion we already spend each year.

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Single Payer Solves –Empirics

A shift to single-payer from privatized health care is possible; Taiwan provesConyers, US rep, 6-10-09(John Conyers, Jr., US Representative on the Subcommittee on Health, Employment, Labor, and Pensions, June 10, 2009, Congressional Testimony, Lexis Nexis) [LO//JW]  The naysayers will also argue that dismantling our employer-based health care system is politically and economically untenable. We have heard this argument before. This argument was initially raised when Medicare was debated in the Congress in the 1960s. Yet, Medicare was enacted in 1965 and fully implemented in 1966. Additionally, the experience of the nation of Taiwan shows that such a transition is feasible. Until 1995, Taiwan had a private health insurance market remarkably similar to our own. Over the course of the next six years, the country seamlessly transitioned to a single-payer national health insurance system. Today, their system boasts a 70 percent approval rating from doctors and patients, while only spending 2 percent on administrative costs.

Only a single payer health care system for all solves; Massachusetts proves

Conyers, US rep, 6-10-09(John Conyers, Jr., US Representative on the Subcommittee on Health, Employment, Labor, and Pensions, June 10, 2009, Congressional Testimony, Lexis Nexis) [LO//JW]  

I would like to caution the committee about the dangers of enacting partial reforms that leave some individuals uninsured, grow the ranks of the underinsured, and do little to contain the out of control growth of health expenditures. The best example of such a legislative failure is the Massachusetts Health Reform Act, enacted by that state's legislature in 2006. The Massachusetts reform effort has failed to contain costs and provide universal coverage because it is built around our broken for-profit private insurance system.Instead of pursuing a reform strategy that has been successful in developed nations around the world - namely, improving access to health insurance that emphasizes prevention, functions without a profit motive, has low administrative costs, has minimal financial barriers to care, and maximizes value for patients - lawmakers in Massachusetts instead created a government- sanctioned monopoly for an industry that has left thousands of state residents without health insurance due to escalating premiums, co-pays, and deductibles.Not surprisingly, without the cost-containment measures that are integral parts of any public insurance plan, health care spending has exploded in Massachusetts. In fiscal year 2009, the reform cost taxpayers $1.3 billion dollars. As a result, Governor Deval Patrick has been forced to cut money from safety-net providers such as public hospitals and community clinics. If the goal of reform is to limit costs and improve access to care, I would respectfully submit that single-payer offers a far better model for reform than the incremental, private insurance giveaway pursued in Massachusetts.

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Uninsured Impoverished

Most people are uninsured because of low incomeKaiser Communication on Medicaid and the Uninsured No Date GivenKaiser Communication on Medicaid and the Uninsured “Myths about the Uninsured” http://docs.google.com/gview?a=v&q=cache%3AUSbyK8FNL18J%3Awww.amsa.org%2Fuhc%2FMythsAboutUninsured.pdf+uninsured+americans+income&hl=en&gl=us&pli=1The majority of uninsured, regardless of how young they are, say they forgo coverage because they cannot afford it, not because they don’t need it. Only 7% of the uninsured report the main reason they lack insurance is because they don’t think they need it. The majority of the uninsured (52%) say the main reason they don’t have health insurance is because it is too expensive and the next most common reason they give is not being eligible for their job’s health benefits (11%).

Uninsured people are more likely to have low incomesU.S. Department of Health and Human Services 05U.S. Department of Health and Human Services Office of the Assistant Secretary for Planning and Evaluation “Overview of the Uninsured in the United States: An analysis of the 2005 Current Population Survey” http://aspe.hhs.gov/health/reports/05/uninsured-cps/index.htm#incomeThe 45.8 million uninsured are more likely to be poor and low income than higher income. Figure 2 shows that over half of the uninsured are below 200% of poverty, with 25% below the poverty line and 28% between 100% and 199% of poverty.(3) That the uninsured are concentrated among lower-income individuals is not surprising, given that low-income individuals are less likely to: * be working, and if they do work they are less likely to be working full time, * receive an offer of insurance, and * be able to afford an offer of coverage. Not all low-income individuals are eligible for Medicaid. Medicaid eligibility is based on a combination of income and population “category.” The population groups that qualify for Medicaid are generally children, parents of dependent children, pregnant women, the disabled, and the elderly . The income levels at which these groups qualify differs from state to state, and group to group, with coverage of children and pregnant women being available at higher income levels, followed by the disabled and elderly, then parents of dependent children last (though this varies by state). Childless adults who are not disabled or elderly rarely qualify for Medicaid , even at the very lowest income levels. While the income distribution of the uninsured is skewed toward those with lower incomes, Figure 2 shows 27% of the uninsured have incomes above 300% of poverty, with one-in-ten (11%) uninsured above 500% FPL.(4) That the uninsured comprise non-trivial percentages of middle and upper income individuals is surprising. Those with incomes above 300% of poverty should generally find employer insurance affordable. Data from employers shows that average single coverage premiums for employer sponsored insurance represent 2.0% of income at 300% FPL, and average family coverage premiums represent 4.7% of income for a family of four at 300% FPL (with a higher percentage for smaller families).

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Uninsured are Poor

Poverty, Poor Health, and Lack of Health Care Are IntertwinedCNN ‘06(Sabriya Rice, associate producer with the CNN Medical Unit, CNN.com, 9/4/06, “Poverty and Poor Health are Intertwined, Experts Say” http://www.cnn.com/2006/HEALTH/08/29/poverty.health/index.html) [LO//JW]

 As financially strapped families struggle to cover basic needs such as food, shelter and the increasing cost of energy, health insurance often takes a back seat on the list of priorities. A National Health Survey conducted by the U.S. Centers for Disease Control and Prevention found more than 40 million people of all ages went without insurance at some point in 2005.More than half remained uninsured specifically because they simply couldn't afford it, the CDC said. Research consistently highlights the negative link between reduced income and worsening health -- as salaries drop, individuals tend to be more stressed, and generally lead less-healthy lifestyles."These people are going to develop diseases at a higher rate and the health care system is going to feel the brunt of it," Woolf said.Poverty's impact is felt most by the nation's children. Children under the age of 5 are more likely to live in extreme poverty. Uninsured children are at greater risk of experiencing health problems such as obesity, heart disease and asthma that continue to affect them later in adulthood. The prevalence of these illnesses does not bode well for future generations, Woolf said."If we amplify the scale by the results of poverty left to run loose, the economic consequence to everybody, to all Americans and all taxpayers, will be substantial," Woolf said. The prevailing thought is that the problem needs to be addressed, and quickly, he said.By making the public more aware of the direction the economy is taking, researchers say they hope policies can be put into place that will keep Americans from living under such difficult conditions in the wealthiest country in the world.

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A2: High Cost

Single payer more cost effectiveAngell, MD, Editor of New England Journal of Medicine, Senior Lecturer @ Harvard Medical School, 2009.Marcia, “Statement of Dr. Marcia Angell introducing the US National Health Insurance Act.” Physicians For A National Health Program. http://www.pnhp.org/facts/statement_of_dr_marcia_angell_introducing_the_us_national_health_insurance_act.php [Mardjuki]

Myth #1 is that we can’t afford a national health care system, and if we try it, we will have to ration care. My answer is that we can’t afford not to have a national health care system. A single-payer system would be far more efficient, since it would eliminate excess administrative costs, profits, cost-shifting and unnecessary duplication. Furthermore, it would permit the establishment of an overall budget and the fair and rational distribution of resources. We should remember that we now pay for health care in multiple ways — through our paychecks, the prices of goods and services, taxes at all levels of government, and out-of-pocket. It makes more sense to pay just once.

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A2: No Innovation/WaitSingle payer system efficient and innovativeAngell, MD, Editor of New England Journal of Medicine, Senior Lecturer @ Harvard Medical School, 2009.Marcia, “Statement of Dr. Marcia Angell introducing the US National Health Insurance Act.” Physicians For A National Health Program. http://www.pnhp.org/facts/statement_of_dr_marcia_angell_introducing_the_us_national_health_insurance_act.php [Mardjuki]

According to Myth #2, innovative technologies would be scarce under a single-payer system , we would have long waiting lists for operations and procedures, and in general, medical care would be threadbare and less available. This misconception is based on the fact that there are indeed waits for elective procedures in some countries with national health systems, such as the U. K. and Canada. But that’s because they spend far less on health care than we do. (The U. K. spends about a third of what we do per person.) If they were to put the same amount of money as we do into their systems, there would be no waits and all their citizens would have immediate access to all the care they need. For them, the problem is not the system; it’s the money. For us, it’s not the money; it’s the system.

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A2: Bureaucracy

Single payer comparatively streamlined bureaucracy compared to private industry.Angell, MD, Editor of New England Journal of Medicine, Senior Lecturer @ Harvard Medical School, 2009.Marcia, “Statement of Dr. Marcia Angell introducing the US National Health Insurance Act.” Physicians For A National Health Program. http://www.pnhp.org/facts/statement_of_dr_marcia_angell_introducing_the_us_national_health_insurance_act.php [Mardjuki]

Myth #3 is that a single-payer system amounts to socialized medicine , which would subject doctors and other providers to onerous, bureaucratic regulations. But in fact, although a national program would be publicly funded, providers would not work for the government. That’s currently the case with Medicare, which is publicly funded, but privately delivered. As for onerous regulations, nothing could be more onerous both to patients and providers than the multiple, intrusive regulations imposed on them by the private insurance industry. Indeed, many doctors who once opposed a single-payer system are now coming to see it as a far preferable option.

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A2: Utopian?

Single payer viable – necessary but needs support.Angell, MD, Editor of New England Journal of Medicine, Senior Lecturer @ Harvard Medical School, 2009.Marcia, “Statement of Dr. Marcia Angell introducing the US National Health Insurance Act.” Physicians For A National Health Program. http://www.pnhp.org/facts/statement_of_dr_marcia_angell_introducing_the_us_national_health_insurance_act.php [Mardjuki]

Myth #4 says that the government can’t do anything right. Some Americans like to say that, without thinking of all the ways in which government functions very well indeed, and without considering the alternatives. I would not want to see, for example, the NIH, the National Park Service, or the IRS privatized. We should remember that the government is elected by the public and we are responsible for it. An investor-owned insurance company reports to its owners, not to the public. Some people say that a single-payer system is a good idea, but politically unrealistic. That is a self-fulfilling prophecy. In my opinion, the medical profession and the public would be enthusiastic about a single-payer system if the facts were known and the myths dispelled. Yes, there would be powerful special interests opposing it and I don’t underestimate them, but with courageous leadership, such as Representative Conyers is providing, and the support of the medical profession and public, I believe there is nothing unrealistic about a National Health Insurance Program. I want to mention one final and very important reason for enacting a national health program. We live in a country that tolerates enormous disparities in income, material possessions, and social privilege. That may be an inevitable consequence of a free market economy. But those disparities should not extend to denying some of our citizens certain essential services because of their income or social status. One of those services is health care. Others are education, clean water and air, equal justice, and protection from crime, all of which we already acknowledge are public responsibilities. We need to acknowledge the same thing for health care. Providing these essential services to all Americans, regardless of who they are, helps ensure that we remain a cohesive and optimistic country. It says that when it comes to vital needs, we are one community, not 280 million individuals competing with one another. In seeking to ensure adequate health care for all our citizens, we have an opportunity today to reassert that we are indeed a single nation.

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A2: Scale Up Not Possible

National modeling off Medicare feasible – Canada proves.Angell, MD, Editor of New England Journal of Medicine, Senior Lecturer @ Harvard Medical School, 2009.Marcia, Quentin Young, American Public Health Association, Joel Alpert, American Academy of Pediatrics, Ron Anderson, CEO Parkland Health System, Peter Beilenson, Commissioner of Baltimore City Health, Christine Cassell, President of American College of Physicians. “Single-Payer FAQ.” Physicians For A National Health Program. http://www.pnhp.org/facts/singlepayer_faq.php#socialized [Mardjuki]

Q: Universal healthcare is okay for a small country or organization like Switzerland, Canada, or the Veterans Administration, but it wouldn’t work when scaled up to meet the needs of a large country like the US A: Medicare is a national program that works reasonably well. There is no reason whatsoever that would make it hard to scale up. Indeed, Medicare was initiated (and administered for tens of millions of enrollees) before computers became available - scaling it up 7 or 8 fold should not prove difficult. In Canada, health care is administered at the provincial level. The Ontario Health Insurance Program, which includes the city of Toronto as well as rural areas, is a good example. Since much of the program we envision would be regionalized, with regions similar in size to Ontario, that program seems a sound indication that scale should not be problematic.

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A2: National Health Program Bad

Single-payer system streamlined and efficient, not national health program.Miller, RN and MSN @ Ball State University. 1993.Anna, “Health Care Reform: Clarifying the Concepts.” Journal of Community Health Nursing, Volume 4, Pgs. 199-211. [Mardjuki]

In a single-payer system, a health care trust fund similar to Social Security or Medicare would receive designated tax revenues, which are then paid to providers by a single governmental entity. The single government payer could be the state, such as Canada's provincial system (U.S. General Accounting Office [GAO], 1991), or the federal government, as in Japan (Sokolovsky & Kline, 1989). Service delivery would remain in the private sector, with consumer choice of provider. Most single-payer systems allow private insurance coverage for additional benefits not included in the public program. Revenue sources could include individual and corporate income taxes, "sin taxes" on alcohol and tobacco, payroll taxes, excise or consumption taxes, value-added taxes (VAT), surtaxes on upper income individuals, Medicare and Medicaid funds, and employer and employee premiums. Increased consumer taxes would be balanced by consumer savings from lower deductibles, co-payments, insurance premiums, and supplemental insurance costs. Single-payer systems would incorporate various cost containment mechanisms and insurance reforms, eliminate exclusions for preexisting medical conditions, and make health insurance portable between jobs . Single-payer systems are not to be confused with a national health program , as exists in Great Britain, where health care providers are salaried government employees working in government-owned and operated facilities.

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A2: Canada Empirically Fails

US single payer solves – even with financial failure Canadian health higher than US.Woolhander, MD & MPH, Himmelstein, MD. 2002.Stephanie, David. “Liberal Benefits, Conservative Spending.” Counterpoint., December. http://www.pnhp.org/PDF_files/LiberalBenefitsConservativeSpending.pdf [Mardjuki]

The key to achieving significant health care savings is single- source payment. Canada and numerous other nations use this solution and it works. Canadian hospitals, which are mostly private, nonprofit institutions, do not bill for individual patients. They are paid a global annual budget to cover all costs, much as a fire department is funded in the U.S. Physicians, m ost of whom are in private practice, bill by checking a box on a simple insurance form. Fee schedules are negotiated annually between provincial medical associations and governments but all patients have the same coverages, or patients with cancer and others who need expensive or long-term care need never fear exceeding their benefits. Unfortunately, during the 1990s, Canada’s health care funding was starved by governments responsive to pressure from the healthy and wealthy who did not want to subsidize care for the sick and poor. Canadian and U.S. health care spending was once comparable, but today Canada spends barely half what we do per capita. Even though shortages of expensive, high-technology care have resulted. Canada's health outcomes remain better than ours: their life expectancy is two years longer and most quality comparisons indicate that Canadians enjoy care equivalent to that received by insured Americans. For instance, Canadian death rates are lower than those in the U.S. for both cardiovascular disease and cancer, especially among younger individuals with potentially curable malignancies. A system structured like Canada's but with double the funding could provide high-quality care without the waits or shortages that Canadians have experienced.

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A2: Rationing

Status quo already faces rationing, plan wouldn’t affect itToner 94Robert Toner, writer for the New York Times “Competing Plan Is Stuck Offstage In Debate Over Better Health Care” lexis-nexis[LO//AS]

Mr. McDermott says he has heard all the objections to a single-payer system: fear of government, fear of vast new taxes, fear of rationing. The rationing issue, he says, is particularly powerful, and, he asserts, particularly unjustified. "People don't look at what's going on in this system right now, in terms of rationing," Mr. McDermott says. "If you have a hernia operation, you don't get to stay in the hospital overnight. They hand you a bottle of pills and send you home after your surgery. Women have a baby; they get sent home the same day they have the baby. "That's rationing done by insurance companies, right now in this country, it's happening all the time." Mr. McDermott has the physician's full measure of disdain for insurance companies. This, in fact, gives much of the power to his arguments: He straddles the divide between those who write health policy and those who live it. He was a psychiatrist for two decades in a variety of settings -- from a private practice to the Seattle/King County Jail to the Foreign Service in Zaire, where he worked with American personnel in sub-Saharan Africa. Before coming to Congress in 1988, he served 15 years in the Washington State Legislature, where he worked on legislation to provide low-cost insurance to low-income and unemployed people. He was appointed to the Ways and Means Subcommittee on Health in 1992. The single-payer movement is often faulted for its political naivete, and there is some grumbling in the House that Mr. McDermott could be more aggressive and more strategic in pressing his case. He is, in fact, less artful in political positioning than Mr. Cooper.

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A2: Socialized Medicine

Single payer is not socialized medicine Campus Progress, 7-19-2009, part of the Center for American Progress for college students, “A ‘Better than Nothing’ Future”, http://fundingourfuture.campusprogress.org/tag/single-payer-health-care/

So why isn’t single-payer health care on the table? Well to start, Conservatives are painting this option as “socialized medicine” or “government take-over”. And the insurance industry strongly opposes the plan because it would mean the end of their glory days. But let’s get one thing straight, single-payer health care is NOT socialized medicine. I liked the Daily Kos explanation of the major differences between the two terms that are getting, conveniently for those opposing it, tossed into the same boat too frequently: Socialized medicine is a system in which the government owns the means of providing medicine. Single-payer health care is not socialized medicine. It’s a system in which one institution purchases all, or in reality, most, of the care . But the payer does not own the doctors or the hospitals or the nurses or the MRI scanners. Medicare is an example of a mostly single-payer system, as is France.

Freedom to choose doctors and physician autonomy make single-payer health care uniquely non-socialist Symonds 94William C. Symonds director of the Forgotten Half Project education program at Harvard “WHITHER A HEALTH-CARE SOLUTION? OH, CANADA” Business Week SOCIAL ISSUES; Number 3363; Pg. 82 lexis-nexis [LO//AS]

For months, the single-payer, or Canadian-style, solution to health-care reform has been dismissed as a nonstarter. Little wonder. At first blush, the idea of turning over one-seventh of the U.S. economy to the federal government seems about as politically palatable as eliminating the tax breaks for home-mortgage interest. But now that the flaws of President Clinton's and other reform plans have become painfully evident and the debate has veered toward gridlock, it's time to give the single-payer plan a hard second look. Admittedly, single-payer is radical. It would decimate the health-insurance industry in one swift stroke. And the Congressional Budget Office estimates that it would require a breathtaking $ 556 billion increase in federal spending by 1998. But this radicalism would serve some profoundly conservative purposes. No other plan would do more to preserve the two traditional bedrocks of American medicine: the freedom to choose your own doctor and the autonomy of physicians to order care as they see fit. Both these principles are seriously compromised by more "conservative" proposals that would force most Americans into managed-care plans. For this reason, the American College of Surgeons recently backed fundamental aspects of a single-payer plan.

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A2: Socialized Medicine

American single-payer could handle increased demand – not socialized. Symonds 94William C. Symonds director of the Forgotten Half Project education program at Harvard “WHITHER A HEALTH-CARE SOLUTION? OH, CANADA” Business Week SOCIAL ISSUES; Number 3363; Pg. 82 lexis-nexis [LO//AS]LIBERAL PROVISIONS. Opponents have raised some legitimate concerns. Many fear that single-payer would lead to runaway demand for services and then rationing, and give the government unbridled power to make life-and-death decisions. To control spending, single-payer would establish a national health budget indexed to economic growth. Proponents contend that this would force better planning, thus sharply slowing the medical arms race that has burdened the U.S. with underutilized facilities. By 2003, the CBO estimates, health-care spending would be cut by $ 114 billion, to $ 175 billion, or as much as 8.6% below what it would be without any changes. Canada and many other nations have already proven such budgets work. But at what cost? The CBO predicts that single-payer's liberal provisions would jack up demand for physician services by 30%, home health care by 50%, and triple demand for drug-abuse treatment. The fear is that the states would then have to ration care by imposing waiting lines and limiting spending on new technology. Opponents foresee a nightmare. "Americans get quite antsy -- if not furious -- about waiting 45 minutes to fill up their gas tanks," says Jack A. Meyer, president of New Directions for Policy, a Washington-based think tank. "They're not going to wait weeks or months for surgery." But Canada's 30 years of experience with single-payer suggests care would not be compromised anywhere near as much as opponents predict. Canadians do face waiting lines for some nonemergency procedures and have far less high-tech equipment. Even so, "the Canadian system has served society, and the average citizen, better than the U.S. system," argues Vickery Stoughton, an American who has worked as CEO of both Toronto Hospital and Duke University Medical Center. In the U.S., de facto rationing already exists, based upon how much you or your insurer can afford to pay. McDermott's plan, sometimes called Canada Deluxe, would minimize constraints by continuing to allocate about 14% of GNP to health care, vs. 9.5% in Canada. Few believe there's any chance Congress will approve a single-payer plan this year. But if Congress approves a bill that allows states to opt for single-payer, as Clinton's plan would, many observers expect it to be adopted by one or more states. Such laboratories would soon demonstrate that single-payer is not "socialized medicine." Rather, it's by far the best way to control costs while preserving the freedom of choice and physician autonomy that made American medicine great.

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A2: MSA/HSA

Medical saving accounts don’t solve – decreases overall affordability and discourages preventative care.Angell, MD, Editor of New England Journal of Medicine, Senior Lecturer @ Harvard Medical School, 2009.Marcia, Quentin Young, American Public Health Association, Joel Alpert, American Academy of Pediatrics, Ron Anderson, CEO Parkland Health System, Peter Beilenson, Commissioner of Baltimore City Health, Christine Cassell, President of American College of Physicians. “Why not MSAs/HSAs?” Physicians For A National Health Program. http://www.pnhp.org/facts/singlepayer_faq.php#socialized [Mardjuki]

Medical savings accounts (MSAs) and similar options such as health savings accounts (HSAs) are individual accounts from which medical expenses are paid. Once the account is depleted and a deductible is met, medical expenses are covered by a catastrophic plan, usually a managed care plan. Individuals with significant health care needs would rapidly deplete their accounts and then be exposed to large out-of-pocket expenses; hence they would tend to select plans with more comprehensive coverage. Since only healthy individuals would be attracted to the MS As/HSAs, higher-cost individuals would be concentrated in the more comprehensive plans, driving up premiums and threatening affordability. By placing everyone in the same pool, the cost of high-risk individuals is diluted by the larger sector of relatively healthy individuals, keeping health insurance costs affordable for everyone. Currently, HSAs offer substantial tax savings to people in high-income brackets, but little to families with average incomes, and thus serve as a covert tax cut for the wealthy.Moreover, MSA /HSA plans discourage preventive care, which generally would be paid out-of-pocket, and do nothing to restrain spending for catastrophic care, which accounts for most health costs. Finally, HS As/MSAs discriminate against women, whose care costs, on average, $1,000 more than men’s annually. Hence, on the MSA /HAS plan, the average woman pays $1,000 more out-of-pocket than her male counterpart.

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A2: Free Market More Efficient

Free market approach increases costs – duplicative equipment and competitive treatments.Angell, MD, Editor of New England Journal of Medicine, Senior Lecturer @ Harvard Medical School, 2009.Marcia, Quentin Young, American Public Health Association, Joel Alpert, American Academy of Pediatrics, Ron Anderson, CEO Parkland Health System, Peter Beilenson, Commissioner of Baltimore City Health, Christine Cassell, President of American College of Physicians. “Won’t Competition Be Impeded By a Universal Health Care System?” Physicians For A National Health Program. http://www.pnhp.org/facts/singlepayer_faq.php#socialized [Mardjuki]

Advocates of the “free market” approach to health care claim that competition will streamline the costs of health care and make it more efficient. What is overlooked is that past competitive activities in health care under a free market system have been wasteful and expensive, and are the major cause of rising costs. There are two main areas where competition exists in health care: among the providers and among the payers. When, for example, hospitals compete they often duplicate expensive equipment in order to corner more of the market for lucrative procedure-oriented care. This drives up overall medical costs to pay for the equipment and encourages overtreatment. They also waste money on advertising and marketing. The preferred scenario has hospitals coordinating services and cooperating to meet the needs of their communities. Competition among insurers (the payers) is not effective in containing costs either. Rather, it results in competitive practices such as avoiding the sick, cherry-picking, denial of payment for expensive procedures, etc. An insurance firm that engages in these practices may reduce its own outlays, but at the expense of other payers and patients.

Free market-based healthcare invariably fails – emotional decisionmaking, uninformed consumers, and demand generated by supply.Miller, RN and MSN @ Ball State University. 1993.Anna, “Health Care Reform: Clarifying the Concepts.” Journal of Community Health Nursing, Volume 4, Pgs. 199-211. [Mardjuki]

Arguments Against Market Competition: The present market-oriented system has left millions uninsured, and even an expanded market system would leave an estimated 4.9 million persons uninsured (White House, 1992). As in our current system, benefits would vary with the insurance carrier or the employer's choice of insurance plan. It is unknown whether voluntary participation would achieve significantly increased insurance coverage or whether tax credits and vouchers would provide a sufficient incentive to purchase adequate health insurance. Market competition relies on an informed consumer; however, consumers might not have enough information to make informed choices for themselves and for other family members. In addition, health care choices often are made during crises when fear, pain, and worry can cloud decision making. There are inherent difficulties in relying on market competition to provide universal access and control costs. In a market economy, increased demand usually generates greater supply (more products). In the health care system, however, demand is generated by supply. For example, increased availability of hospital beds, medical technology, or outpatient services results in increased use of those services. Within a fee-for-service reimbursement system, providers have incentives to create demands for the services they provide using self-determined fees. Compared to HMO physicians, fee-for-service physicians tend to provide more hospital-intensive, and therefore more expensive medical care (Manning, Leibowitz, Goldberg, Rogers, & Newhouse, 1984). In addition, providers sometimes use "creative billing" to sidestep existing cost control mechanisms.

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A2: O’Neill

Free market approach increases costs – duplicative equipment and competitive treatments.Angell, MD, Editor of New England Journal of Medicine, Senior Lecturer @ Harvard Medical School, 2009.Marcia, Quentin Young, American Public Health Association, Joel Alpert, American Academy of Pediatrics, Ron Anderson, CEO Parkland Health System, Peter Beilenson, Commissioner of Baltimore City Health, Christine Cassell, President of American College of Physicians. “Recent Attacks on Single Payer Health Reform: Ideology Masquerading as Scholarship” Physicians For A National Health Program. http://www.pnhp.org/facts/singlepayer_faq.php#socialized [Mardjuki]

The O’Neills collected no new data. Their analysis rests on idiosyncratic, highly selective and overtly biased reinterpretations of previously published data — mostly from the Joint Canada/U.S. Survey of Health (JCUSH), a population-based survey conducted jointly by the U.S. and Canadian government statistical agencies. While they extensively cite the few pieces of published data that supports their grim view of Canada’s health system, they ignore a large body of research and statistics that conflicts with their portrayal.

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A2: Employer-Based HC

Employer-based insurance fails – doesn’t cut costs.Miller, RN and MSN @ Ball State University. 1993.Anna, “Health Care Reform: Clarifying the Concepts.” Journal of Community Health Nursing, Volume 4, Pgs. 199-211. [Mardjuki]

: Opponents of the play or pay approach point out that employers do not really pay for employee benefits; they simply pass added costs on to consumers through higher prices. American business already underwrites approximately 30% of U.S. health care costs (Polzer, 1990). Small businesses might be unable to afford the added expense of providing health care insurance. In 1990, small business (fewer than 100 employees) provided 51% of all jobs (Edwards et al., 1992). Some fear that employer-mandated insurance establishes a two-tier system, with a lower quality and less adequate public plan. A play or pay approach also does not inherently improve quality or efficiency of services or reduce administrative costs.

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A2: Managed Competition

Managed competition fails – lack of quality control and structure not nationally viable.Miller, RN and MSN @ Ball State University. 1993.Anna, “Health Care Reform: Clarifying the Concepts.” Journal of Community Health Nursing, Volume 4, Pgs. 199-211. [Mardjuki]

Managed competition continues the present employer-paid insurance with its inherent difficulties. Large-scale use is untried, and past experience does not indicate that HMOs are necessarily more cost-effective than other models (Polzer, 1990). Inherent difficulties include lack of accurate and understandable quality outcome data from health care providers, minimal knowledge about consumer health care decision-making processes, and the problems involved in educating consumers to make cost-efficient choices. Some question the feasibility of mandating nationwide managed competition. For example, inner city areas may have difficulty attracting competing health plans. In addition, more than one half of all Americans live in areas with a population density too low for more than one HIPC to operate, thus making competition impossible in those areas (Clancy, Himmelstein, & Woolhandler, 1992). Before mandating managed care across the country, some suggest that states first be given freedom to try various methods of providing universal coverage, controlling costs, and improving quality. This would require Medicaid and Medicare waivers, which may be possible. Employee Retirement Income Security Act (ERISA) waivers, however, are more important and more difficult to obtain. The federal ERISA law exempts self-insured businesses from state insurance mandates (Rublee, 1986). Many large businesses self-insure and assume their own health care costs rather than buying health insurance (Dobson, Moran, & Young, 1992). Although these self-insured businesses often contract with an insurance company to manage their insurance claims processes, technically they do not sell insurance and thus are exempt from state regulations. Therefore, self-insured companies can choose to provide fewer benefits or require higher co-payments, and they do not have to provide state-mandated insurance benefits or participate in state high-risk pools (National Health Policy Forum, 1990). Unless states receive an ERISA waiver, they have no authority over self-insured companies. To date, only Hawaii has received such a waiver because the Hawaii plan was in place before ERISA was enacted (National Health Policy Forum, 1991). Without an ERISA waiver, ever more companies will try to escape government mandates by becoming self-insured. (Note that self-insured is not to be confused with individual insurance for those not part of group plans.) Opponents of managed competition also point out the difficulty in using outcomes to evaluate physicians, question whether managed competition would provide sufficient incentives for quality medical care, and suggest it may be a slippery slope to a government-based system (Griffin, 1992).

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A2: Physician Backlash

Growing physician discontent with current regime – can be catalyst for large-scale reform.Borosage, prof of law @ American University, Hickey, vice president @ Economic Policy Institute. 2001.Robert and Roger. The Next Agenda: Blueprint for a New Progressive Movement. Pg 118-119. [Mardjuki]

The events of the past decade have provided new opportunities to expand the coalition for health reform. The transformation of the medical system through various managed care practices has created deep discontent among physicians with current arrangements. Already, consumer groups and physicians’ associations have subdued their traditional enmity and are working together to pass both state and federal laws regulating HMOs and other managed care plans. That alliance could reasonably be taken a step further. Given doctors’ unhappiness with their growing lack of clinical authority and with the corporatization of American insurance that incorporates large segments of the medical community. Physicians may be increasingly persuaded that they will fare better under a public system that would reinstate their clinical autonomy than under the corporate control of private health plans. Historically, physicians have been a strong obstacle to large-scale reform. In the future, they may prove a key catalyst to its enactment.

Single Payer has gained backing, including physician associationsKnox 3/20Richard A. Knox, writer for the Boston Globe, “Surgeons' uproar shows reform rift” Lexis-Nexis [LO//AS]

When the Board of Regents was first discussing this about eight to 10 months ago, I think almost to a person our reaction was: 'Single-payer system? You've gotta be kidding!' " Murray said in an interview. "Then as we learned more of what was going on, got input from all over the country, and learned how the Clinton plan would partially be financed by cutting back on Medicaid and Medicare, we began to take a little different approach." Murray and leaders of other physician groups say the College of Surgeons did not anticipate the reaction they got from members. "Because physician groups have historically been so opposed to single-payer, when anyone says anything moderate about it, it suddenly sounds like a radical statement," said Dr. Robert Graham, executive director of the American Academy of Family Physicians. A similar thing happened some months back to the American Medical Association. The AMA previously favored an "employer mandate" that would force employers to help pay for their workers' coverage. But to placate conservative physicians opposed to the Clinton plan with its employer mandate, AMA leaders scrambled to fashion a compromise that put the group on record as neither favoring nor opposing such a policy. Despite all the damage control and spin, Murray said the College of Surgeons's policy making board has not backed down from its consensus in favor of a Medicare-style, single-payer approach to health reform. "We felt as a board that the single-payer system would probably provide the best assurances that patients would be able to seek care from any doctor of their choice."

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**Add-ons**

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Small Business Add-on

Health care taxes would destroy small businesses – key to the economy.Lambro 2/27Donald Lambro is the chief political correspondent of The Washington Times, the author of five books on the government and the economy, and a nationally syndicated columnist He won the 1995 Warren Brookes Award for Excellence in Journalism “LAMBRO: Obama's budget to raise small-business taxes” February 27, 2009 (http://www.washingtontimes.com/news/2009/feb/27/obamas-budget-to-raise-small-business-taxes/)[LO//AS]Business advocates charged that multiple tax increases on Americans earning more than $250,000 a year would whack small businesses who pay the individual income tax, too, and produce as much as 60 percent of all jobs . "You don't build a house by blowing up its foundations. Small businesses and the entrepreneurs who lead them have been the primary drivers of job growth over the past decade. This plan would punish them with higher taxes, resulting in less government revenue, less economic growth, and fewer jobs - not more," said Bruce Josten, chief lobbyist at the U.S. Chamber of Commerce. On Capitol Hill, House Minority Leader John A. Boehner of Ohio called the budget plan a "job killer," saying that "small businesses, family farms, middle-class families, retirees, charities, everyone with a 401(k), and anyone who flips on a light switch is going to pay higher taxes under this plan." Mr. Obama ran for president saying he will raise taxes on wealthy Americans by boosting the present 35 percent top income tax rate to the nearly 40 percent rate under President Clinton in the 1990s. Then, as the recession deepened last year, he changed his mind, saying that this was not the time to raise taxes on higher income people because it would further weaken the economy. But Mr. Obama needs increased revenue to launch his national health care plan - which will cost an estimated $1 trillion over 10 years - and his budget calls for letting President George W. Bush's two top tax rates expire at the end of 2010 . The White House expects the economy to be in a recovery at that time, but many economists, including members of the Federal Reserve Board, say it could still be in a recession or in a weakened condition well into 2011. Business advocates charged that multiple tax increases on Americans earning more than $250,000 a year would whack small businesses who pay the individual income tax, too, and produce as much as 60 percent of all jobs . "You don't build a house by blowing up its foundations. Small businesses and the entrepreneurs who lead them have been the primary drivers of job growth over the past decade. This plan would punish them with higher taxes, resulting in less government revenue, less economic growth, and fewer jobs - not more," said Bruce Josten, chief lobbyist at the U.S.

<insert econ impact>

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Small Business Add-on Ext

Businesses are suffering from privatized HCPibel and Gelder 06Doug Pibel and Sarah Van Gelder, editors for Yes! Magazine, an award-winning publication “ Health Care: It's What Ails Us” http://www.yesmagazine.org/issues/health-care-for-all/1498[LO//AS]Businesses are suffering too. Insurance premiums increased 73 percent between 2000 and 2005, and per capita costs are expected to keep rising. The National Coalition on Health Care (NCHC) estimates that, without reform, national health care spending will double over the next 10 years. The NCHC is not some fringe advocacy group—its co-chairs are Congressmen Robert D. Ray (R-IA) and Paul G. Rogers (D-FL), and it counts General Electric and Verizon among its members. Employers who want to offer employee health care benefits can't compete with low-road employers who offer none. Nor can they compete with companies located in countries that offer national health insurance . The shocking facts about health care in the United States are well known. There's little argument that the system is broken. What's not well known is that the dialogue about fixing the health care system is just as broken . Among politicians and pundits, a universal, publicly funded system is off the table. But Americans in increasing numbers know what their leaders seem not to—that the United States is the only industrialized nation where such stories as Joel's and Kiki's can happen.

National Health Insurance helps small businessesMarks, author of best-selling small business books, 7/21owner of the Marks Group, which sells customer relationship, service, and financial management tools to small and midsize businesses. Marks is the author of four best-selling small business books. Written in Business Week “National Health Care: How Small Business Will Fare” http://www.businessweek.com/smallbiz/content/jul2009/sb20090721_906996.htm [LO//AS]Will national health care benefit us as a country? I'm not really sure. But one thing I know for sure: British food is terrible. And a national health insurance system would be a good thing for small business owners. Not a bad thing. Now before my fellow conservatives handcuff me to a TV and force me to watch 20 hours of The Franken & Davis Show, let me explain. For one, as a business owner, a national insurance plan would be cheaper for me. Way cheaper. Yes, those critics are probably right—socialized medicine will probably lead to higher individual taxes, longer wait times for treatment, lower-quality health care, and a strong urge to have tea and biscuits at 4 o'clock. But take a look at these numbers from a client of mine—a 50-person manufacturer in Pennsylvania. In 2008 it paid $375,000 net health insurance on a payroll totaling $2.086 million. (This included the owners.) And this is for a pretty basic Blue Cross plan. That works out to 18% of its payroll cost. If we go with the President's 8% plan, the company would save about $208,000. If we opt for Kennedy's proposal, it would save $337,500 per year!

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Equal Protection

Universal Health Care Solves Equal Protection RightsTepperman, Chief for Pittsburg Health System, ‘06(Dr. Barry Tepperman, Department of Radiation Oncology at Allegheny General Hospital, graduated from the University of Toronto with an MBA in Health Administration; Chief of Radiation Therapy for the Pittsburg Health System. 9/21/06. “Establishing a Right to Health Care.” Speech to PA’s House of Representatives, http://www.democrats.org/page/community/group/AdvocatesforSingle-PayerHealthCare) [LO//JW]

 The Declaration of Independence speaks to unalienable rights including life, liberty, and the pursuit of happiness. The Declaration of Rights of the Pennsylvania Constitution speaks of universal inherent and indefeasible rights, which include enjoying and defending life and liberty, of acquiring, possessing, and protecting property and reputation, and of pursuing their own happiness. One need ask whether there are conditions under which in the daily life of a Pennsylvania resident these rights are compromised or denied. I respond that in the absence of optimal physical, emotional, and psychological health or the opportunity to be as fully as possible restored to such a state, these rights cannot be achieved. If an individual's quality of life is compromised for want of health care, life and liberty are devalued, happiness for him and for those who care for him - is unachievable, property and reputation are meaningless. I maintain that by implication of these sweeping but generally accepted statements this nation grants a fundamental and irrefutable right to health and to health care. In order to meet the constitutional test of equal protection, such care needs to be of equal quality and equally accessible to all residents of the state, in a fashion which does not discriminate according to factors such as financial resources or potential, current employment or future prospects, physical ability, current or prior infirmity, site of residence, or the profit needs of third parties much less the generally regarded criteria of race, religion, ethnicity, or age.

Pennsylvania society differentiates in access to health care between the rural and the urban, between ethnic and racial groups, those housed and those homeless, to create castes of medical untouchables; the uninsured, the underinsured, the uninsurable, those who can access the system only after a minimal problem has progressed through neglect and want of access to crisis proportions . Even those who are as fully insured as this system allows are distinguished according to their private insurer and the quality of their insurance. This creates the medically ethically untenable situation where, according to what they will pay for and what employers have contracted for, in the same physicians' practice treating comparable patients different insurers will demand different standards of care a distinction based on the insurers' need for profit and not on any scientific evidence or medical logic. The current canon of medical ethics reasons acceptable behavior from four basic principles one of which is justice - simple fairness and equity in the use and application of resources. Our current system denies care to many and violates that ethical precept in the care of countless more. Only a system that guarantees equal access for all and a single standard of care based on scientific evidence will pass the test of equal protection for all Pennsylvania residents and I would submit to you that only through a single-payer universal health care system can that be achieved.

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**2AC**

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Plan Pop

Plan popular – public and Congress.FAIR March 6, 2009.Fairness and Accuracy in Reporting. “FAIR Study: Media Blackout on Single-Payer Healthcare.” http://www.fair.org/index.php?page=3733 [Mardjuki]

CNN senior medical correspondent Elizabeth Cohen has herself adopted this terminology in discussing healthcare reform, stating (CNN Newsroom, 2/26/09) that "if in time, Americans start to think what President Obama is proposing is some kind of government-run health system--a la Canada, a la England--he will get resistance in the same way that Hillary Clinton got resistance when she tried to do tried to do this in the '90s." Particularly in the absence of actual coverage of single-payer, such rhetoric confuses rather than informs, blurring the differences between the Canadian model of government-administered national health insurance coupled with private healthcare delivery that single-payer proponents advocate, and healthcare systems such as Britain's, in which healthcare (and not just healthcare insurance) is administered by the government. The views of CNN's senior medical correspondent notwithstanding, opinion polling (e.g., ABC News/Washington Post, 10/9-19/03) suggests that the public would actually favor single-payer. Though more than 60 lawmakers have co-sponsored H.R. 676, the single-payer bill in Congress, Obama has not expressed support for single-payer; both the idea and its advocates were marginalized in yesterday's healthcare forum. But given the high level of popular support the policy enjoys, that's all the more reason media should include it in the public debate about the future of healthcare.

Expansion of Medicare system popular – less contentious than new healthcare reform.Miller, RN and MSN @ Ball State University. 1993.Anna, “Health Care Reform: Clarifying the Concepts.” Journal of Community Health Nursing, Volume 4, Pgs. 199-211. [Mardjuki]

A new single-payer system could be designed for the entire population. Alternatively; existing governmental health insurance programs could be modified and expanded to provide insurance coverage for specific population groups. Expansion of existing public programs might be more politically acceptable than establishing completely new programs (Harrington, 1990). Expand Medicare to everyone. The existing single-payer Medicare system could be expanded to include everyone, adding preventive, perinatal, and well child care. Everyone would have a medical identification card (like a Medicare card), copayments and deductibles would be reduced for low-income persons, and there would be no charge for most preventive services. Private insurance systems could insure for services not covered by this single public plan.

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Plan Unpop

Single payer healthcare controversial – plethora of interest groups.Borosage, prof of law @ American University, Hickey, vice president @ Economic Policy Institute. 2001.Robert and Roger. The Next Agenda: Blueprint for a New Progressive Movement. Pg 115. [Mardjuki]

Indeed. the United States has the most intrusive regulation of medical care practice of any OECD nation, although the bulk of that intrusiveness arises from private regulation rather than pub- lic legislation. Perhaps that is why Canada's model has held such appeal for American reformers during the past quarter century. At the same time, however, this model has awakened the intense opposition of groups whose incomes would be harmed by such a reform. lt is no sur- prise that the HIAA, the AMA, the trade association of the drug industry, and the managed care trade association have treated the Canadian model as the problem rather than the solution. ln spring 2000 a newly formed group disingenuously describing itself as "Citizens for a Better Medicare" launched a multimedia campaign "urging American seniors to reject the Canadian model of health insurance and coverage of prescription drugs.`° Forty groups sponsored this campaign, including such traditional opponents of government health insurance as the Chamber of Commerce, the National Association of Manufacturers, and the pharmaceutical trade association. In short, the problem with the Canadian model is not an absence of substantive merit, but the intensity of opposition to it by financially interested and ideologically opposed par- ties."

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Losers Win?

Placing blame on opposition expands support for failed healthcare reform.Borosage, prof of law @ American University, Hickey, vice president @ Economic Policy Institute. 2001.Robert and Roger. The Next Agenda: Blueprint for a New Progressive Movement. Pg 116. [Mardjuki]

If You Lose, Lose the Right Way. As our overview of the politics of national health insurance makes clear, the obstacles to enactment of substantial reform are formidable. Reformers must confront the reality that political setbacks and legislative defeats are not only possible but probable. As important as it is to shape the terms of victory, it is equally critical to influence the terms on which one loses. In 1948, President Truman’s national health insurance plan went down to defeat; yet Truman used that defeat as an element in his presidential campaign against the infamous “do-nothing" Congress . In contrast, after the Clinton health plan politically irnploded in I994, even the administration abandoned its plan. The administration had no end-game strategy when legislative support for health refom failed to materialize; therefore the blame for the failure of health reform lay as much on President Clinton as it did on his congressional opponents. The lesson for reformers is this: If legislation cannot pass, there still may be political benefit to extract if responsibility for blocking expanded health insurance coverage can be clearly pinned on the opposition. In that respect, even unsuccessful legislative efforts may keep health reform on the agenda and in some circumstances may help expand support for it.

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1. Won’t pass – slowed momentum, Obama’s decreasing popularity, and Congressional opposition.Austin, staff reporter. 7/27/09Jillian. “Obama’s first White House summer one of controversy, health-care headaches.” Brandon Sun. http://www.brandonsun.com/story.php?story_id=150210 [Mardjuki]

The dog days of summer are not being kind to President Barack Obama. His poll numbers have slipped, his health-care overhaul isn't likely to be ready this week despite his fondest hopes, and there is lingering fallout from the president's remarks last week about the arrest of a friend. A month ago, the Obama administration was delighted it had managed to push through a major climate-change bill in the House of Representatives, and hoped for the same success on health care. Indeed, the White House was hopeful it could get much of its agenda through Congress in 2009. But 52 fiscally conservative Democrats - known as Blue Dogs - have emerged as a major thorn in the side of the Obama administration and party leaders. The Blue Dogs are apparently fearful that Republicans will have the upper hand in the 2010 mid-term elections, and have grown bolder in openly defying Obama and his powerful allies, including House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid. The Blue Dogs take issue with crucial elements of their party's health-care reform bill, and are resisting admonishments from those top Democrats not to jeopardize Obama's most cherished and ambitious legislative effort . "I think the American people want to take a closer look at this legislation . They want to feel more comfortable with it," Jim Cooper, a Blue Dog from Tennessee, said over the weekend. Cooper said a vote in the House on the bill likely wouldn't be held until after Labour Day . Obam a had wanted the bill passed before the August recess , which begins at the end of the week, so that Americans would have a new health-care system by October. Pelosi has pledged to bring unruly Democrats to heel and pass the bill in the days to come, but it seemed unlikely with the Blue Dogs still standing firm. On Monday, Democratic leaders pointed to a new congressional report to refute Republican claims that their health-care reform plan would amount to a government takeover of the health insurance industry. The report from the Congressional Budget Office suggested a government plan could co-exist with private insurers without driving them out of business. Democrats also headed into a lengthy meeting on Monday afternoon to review the bill section by section in an attempt to better understand the concerns of the Blue Dogs while they hold up the bill. It's all made for a tense atmosphere in Washington that has Republicans gleeful at the idea of using health-care reform to cause permanent damage to Obama . "If we're able to stop Obama on this, it will be his Waterloo. It will break him," Republican Senator Jim De Mint recently proclaimed. The president's poll numbers are , indeed, taking a hit as Americans worry not just about health-care reform, but deficit spending and rising unemployment.

2. No spillover – politicians evaluate bills on a case by case basis – make them read evidence this affects other bills.

3. Expansion of Medicare system popular – less contentious than new healthcare reform.Miller, RN and MSN @ Ball State University. 1993.Anna, “Health Care Reform: Clarifying the Concepts.” Journal of Community Health Nursing, Volume 4, Pgs. 199-211. [Mardjuki]

A new single-payer system could be designed for the entire population. Alternatively; existing governmental health insurance programs could be modified and expanded to provide insurance coverage for specific population groups. Expansion of existing public programs might be more politically acceptable than establishing completely new programs (Harrington, 1990). Expand Medicare to everyone. The existing single-payer Medicare system could be expanded to include everyone, adding preventive, perinatal, and well child care. Everyone would have a medical identification card (like a Medicare card), copayments and deductibles would be reduced for low-income persons, and there would be no charge for most preventive services. Private insurance systems could insure for services not covered by this single public plan.

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4. No link – do the plan and pass universal healthcare. The DA isn’t intrinsic –a. It’s reciprocal – negative can counterplan out of advantages to test their germaneness to the plan.

Intrinsicness allows the aff to test the relevance of the link.

b. It’s fair – we’ll only make one intrinsicness argument per debate. This solves back any infinite regression claims.

b. Federal policymakers could control both impacts – they can pass the plan and healthcare reform

5. Obama’s political capital is down- healthcare, Iran election, economyU.S. News, 7/1/2009, “Strategists worry Obama’s popularity is dropping” http://www.usnews.com/articles/news/obama/2009/07/01/strategists-worry-obamas-popularity-is-dropping.html

President Obama i s heading into stormy waters. His healthcare plans have stalled on Capitol Hill; he is being faulted for a shaky response to the post-election violence in Iran; his job-a pproval ratings are dropping; and confidence in his handling of the economy is ebbing . The warning signs are enough to worry Democratic strategists that Obama may be sinking into a trough that will sap his influence just when he needs it most.Until now, President Obama has enjoyed a honeymoon with the country and the media (although not with opposition Republicans). This was because the supremely articulate, charismatic Obama presented such a contrast to George W. Bush, who remains unpopular. In addition, voters wanted action from their president in tough times, according to Democratic pollster Geoff Garin, and Obama delivered. In fact, he has moved the federal government into a more activist role than it has had under any other president in years, bailing out the financial industry, taking over much of the U.S. auto industry, injecting vast sums of money into the economy, and proposing huge changes in healthcare, energy policy, and other areas of national life. Finally, Obama is very appealing as an individual, which initially boosted his ratings.But the ground may be shifting. Over the past couple of weeks, Obama has endured a surge of bad news, reversing his momentum. The C ongressional B udget O ffice estimated tha t one of the major Democratic healthcare proposals being circulated in the Senate would cost an astounding $1 trillion ; the estimate for another plan was even larger—$1.6 trillion. This sent legislators scurrying to reduce the price tags, which will in turn cause delays in considering the massive bills this summer and could jeopardize passage in the fall.Another setback came when two powerful insurers' a ssociations announced t heir opposition to an Obama-backed government health plan that would be in competition with private, employer-sponsored plans . In a letter to senators released this week, America's Health insurance Plans and the Blue Cross Blue Shield Association wrote, "Regardless of how it is initially structured, a government plan would use its built-in advantages to take over the health insurance market." But Obama told a news conference Tuesday, "The public [government] plan, I think, is an important tool to discipline insurance companies."

6. Uniqueness overwhelms the link – some semblance of health care is guaranteed by Obama’s political clout – it’s too big to fail. That’s Woodhead 9.

7. Impact inevitable – Boston Globe 9 is in context of Social Security reform, not healthcare – healthcare doesn’t send the financial signal of solvency international investors are looking for

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8. Winners win - a Fight Is Critical For Obama to Assert StrengthXimena Ortiz, @ National Interest, 3/26/’9 [Barack the Timid, http://www.org/Article.aspx?id=21156]

But an appreciation for those headlines of history could unduly influence the president. It would only be natural for the first black president to harbor a sense of responsibility to avoid alienating parts of the country. Indeed, Obama seems to be taking pains to prevent divisiveness at a time when he should be taking clear policy directions and expending political capital . At no other point in his presidency will Obama have four years to mitigate the impact of his tough choices. And given the state of the country he inherited, he faces nothing but tough choices . To some Americans, Obama’s rise to power has fulfilled a nation’s egalitarian promise and remedied racial injustice. Obama should consider that promise now fulfilled and the symbolic gain made, and move on—as he said he has done. Given the fluctuations of the polls leading up to Obama’s victory in November, most Americans judged the presidential contender based on his positions and their read on the current condition of the country, rather than on preoccupations with his race. Some Americans may have surmounted preconceptions of race in voting for Obama, but the country does not, by and large, seem to perceive Obama as a black president, but rather as the president. Americans regard the symbolic salve on racial wounds as a welcomed development, but not as the overriding priority. And given the state of the country and its foreign endeavors, the public is probably prepared to countenance some far-reachin g and consistent policy making. Obama should begin stepping on some toes, to the benefit of those eponymous ordinary Americans—and those not so ordinary. Obama still has four years for those policy decisions to yield results, but he has to steer that ocean liner in the right direction—and be persistent.

9. Can’t solve the economy – Obama’s healthcare proposals cause entitlement spending to skyrocket, either increasing the deficit or raising taxes 8 percent – that’s Pear 9.

10. <CASE OUTWEIGHS>

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1. Votes aren’t there from the GOPGrotto, Staff Writer, ’09 (Andrew, RealClearPolitics, “Nuclear Arms in the developing world,” April 8,http://www.realclearpolitics.com/articles/2009/04/nuclear_arms_in_the_developing.html)

Obama's speech on Sunday should begin the process of clearing the air. He announced support for Senate ratification of the CTBT and a verifiable FMCT. Earlier in the week, he laid out an ambitious arms control agenda with Russia for achieving substantial nuclear reductions. These steps toward nuclear disarmament are worthwhile in their own right. But the Obama administration also hopes that by addressing developing country concerns about disarmament, these countries will be much more inclined to support an ambitious nonproliferation agenda that includes a more intrusive International Atomic Energy Agency Inspections regime, tighter global export controls, and a new framework for civilian nuclear energy development that precludes development of national uranium enrichment facilities. Of course, the Obama administration must now follow through on its pledges, which won't be easy. Arms control negotiations with the Russians will be challenging enough, but the Obama administration must also successfully negotiate with Capitol Hill. Treaties require a two-thirds majority in the Senate, which means that the majority Democrats will still need to attract the support of more than a half-dozen Republicans for CTBT and FMCT ratification.

2. CTBT only stops testing, no reason that’s key to prolif

3. The right to test is essential to credible deterrenceBarbara Conry, associate policy analyst at Cato, “Danger or Deterrent?” 1999, http://abcnews.go.com/sections/world/TakingSides/takingsides1.html, accessed 8/14/02Relinquishing the right to conduct tests — thereby gambling the U.S. nuclear deterrent on the technologically risky SSP — poses an unacceptable security risk. Moreover, even if the SSP functions as it is supposed to, it is not clear that future adversaries will be convinced that the American nuclear arsenal is, indeed, militarily effective. When it comes to deterrence, the perception of a potential adversary is critical. The Senate has a responsibility to ensure that no future Saddam Hussein or Slobodan Milosevic has any reason to doubt the effectiveness of the American nuclear arsenal.

3. CTBT won’t be ratified – it’s not verifiableKyl and Perle, Senator and Fellow, 6/30/09 (Jon and Richard, Arizona, American Enterprise Institute, The Wall Street Journal, “Our Decaying Nuclear Deterrent,” http://online.wsj.com/article/SB124623202363966157.html)

Thus, in his Prague speech, Mr. Obama announced that the U.S. would "immediately and aggressively" pursue ratification of the comprehensive ban on the testing of nuclear weapons . The administration believes, without evidence, that ratification of the test-ban treaty will discourage other countries from developing nuclear weapons. Which countries does it have in mind? Iran? North Korea? Syria? Countries alarmed by the nuclear ambitions of their enemies? Allies who may one day lose confidence in our nuclear umbrella? There are good reasons why the test-ban treaty has not been ratified. The attempt to do so in 1999 failed in the Senate, mostly out of concerns about verification -- it simply is not verifiable. It also failed because of an understandable reluctance on the part of the U.S. Senate to forgo forever a test program that could in the future be of critical importance for our defense and the defense of our allies. Robert Gates, who is now Mr. Obama's own secretary of defense, warned in a speech last October that in the absence of a nuclear modernization program, even the most modest of which Congress has repeatedly declined to fund, "[a]t a certain point, it will become impossible to keep extending the life of our arsenal, especially in light of our testing moratorium." Suppose future problems in our nuclear arsenal emerge that cannot be solved without testing? Would our predicament discourage nuclear proliferation -- or stimulate it?

4. There is no evidence indicating that political capitol would spillover onto CTBT5. Countries like Iran and North Korea would not sign CTBT

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a. They want to build nuclear weapons, meaning it would be unstrategic2AC CTBT Politics (2/3)

b. The international community already holds disdain for them, not signing CTBT would not uniquely increase it

c. The US signing it would not incentivize them to sign it if they dislike the US6. Nuclear proliferation creates an increase in international stability – even anti-prolif experts agree that

nuclear weapons are deterrents, can’t fall into terrorist hands, and would only decrease the chance of great power wars.

Bennett 05Drake Bennett, writer for The Boston Globe, “Give nukes a chance Can the spread of nuclear weapons make us safer?” http://www.boston.com/news/globe/ideas/articles/2005/03/20/give_nukes_a_chance/?page=3

KENNETH N. WALTZ, adjunct professor of political science at Columbia University, doesn't like the phrase ''nuclear proliferation.'' ''The term proliferation' is a great misnomer,'' he said in a recent interview. ''It refers to things that spread like wildfire. But we've had nuclear military capabilities extant in the world for 50 years and now, even counting North Korea, we only have nine nuclear countries.'' Strictly speaking, then, Waltz is as against the proliferation of nuclear weapons as the next sane human being. After all, he argues, ''most countries don't need them.'' But the eventual acquisition of nuclear weapons by those few countries that see fit to pursue them, that he's for. As he sees it, nuclear weapons prevent wars. ''The only thing a country can do with nuclear weapons is use them for a deterrent,'' Waltz told me. ''And that makes for internal stability, that makes for peace, and that makes for cautious behavior.'' Especially in a unipolar world, argues Waltz, the possession of nuclear deterrents by smaller nations can check the disruptive ambitions of a reckless superpower. As a result, in words Waltz wrote 10 years ago and has been reiterating ever since, ''The gradual spread of nuclear weapons is more to be welcomed than feared.'' Waltz is not a crank. He is not a member of an apocalyptic death cult. He is perhaps the leading living theorist of the foreign policy realists, a school that sees world politics as an unending, amoral contest between states driven by the will to power. His 1959 book, ''Man, the State, and War,'' remains one of the most influential 20th-century works on international relations. In recent weeks, however, the spread of nuclear weapons has taken on what might appear to be a wildfire-like quality. North Korea has just declared itself a nuclear power. Iran is in negotiations with the United States and Europe over what is widely suspected to be a secret weapons program of its own. Each could kick off a regional arms race. And North Korea in the past has sold nuclear technology to Libya and Pakistan, while Iran sponsors Hezbollah and Hamas. As the Nuclear Nonproliferation Treaty, the backbone of nonproliferation efforts for the past 35 years, comes up for review this May, there's an increasing sense that it is failing. In such a context, Waltz's argument may seem a Panglossian rationalization of the inevitable. Still, although heads of state, legislators, intelligence officials, and opinion columnists are nearly united in their deep concern over the world's nuclearization, the scholars who spend their time thinking about the issue are in fact deeply divided over the consequences of the spread of nuclear weapons, even to so-called ''states of concern'' like Iran and North Korea. Few among Waltz's colleagues share his unwavering confidence in the pacifying power of nuclear weapons. But plenty among them see at least some merit in the picture he paints. In part, the disagreement between Waltz and his critics is over the meaning and value of nuclear deterrence in a post-Cold War world. But it's also an argument over the motives that drive some countries to pursue nuclear weapons and others to want to keep the nuclear genie to themselves. . . . Waltz spells out his theory most thoroughly in the 1995 book ''The Spread of Nuclear Weapons,'' co-written with the Stanford political scientist Scott D. Sagan in the form of an extended debate. Updated and republished two years ago to take into account the nuclearization of India and Pakistan, it contains the same arguments Waltz makes today in interviews. Put simply, a war between nuclear powers cannot be decisively won without the risk of total destruction. Since the risk of escalation in any conflict is so high, nuclear states grow cautious. ''If states can score only small gains because large ones risk retaliation,'' Waltz writes, ''they have little incentive to fight.'' When fighting does break out, it is likely to be a localized proxy conflict like the Korean War instead of, say, a Soviet invasion of Western Europe. Nuclear weapons, he adds, even blunt the urge for territorial expansion, since they contribute far more to a country's security than any geographical buffer could. Even Graham Allison, a dean and professor at Harvard's Kennedy School of Government and one of the country's most visible nonproliferation crusaders, concedes some of Waltz's argument. ''There's something known in the literature as a crystal ball effect,''' Allison says. ''With a nuclear war, probably most of the people living in the capital are going to be killed, including the leader and his family, so it brings it home. You have a positive effect, and you can certainly see that in the India-Pakistan relationship'' since both countries acquired their nuclear arsenals. Yet Allison-whose latest book, the widely noted ''Nuclear Terrorism: The Ultimate Preventable Catastrophe,'' was published last August-dismisses Waltz's larger linkage between proliferation and security as ''perverse, but nonetheless interesting.'' In particular, Allison argues, the time

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period just after a country goes nuclear-in the case of North Korea, the present moment-is the most dangerous. This is partly because nascent nuclear nations don't have the best command and control systems for their weapons. More troubling is that historically, in

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every so-called nuclear ''conflict dyad''-US/USSR, USSR/China, India/Pakistan-the first of the two to go nuclear came close to launching a preemptive attack to profit from its nuclear advantage. And the precarious hold on power of the government in a nuclear nation like Pakistan only adds to the volatile mix. Even today's long-established nuclear powers, Allison points out, may owe their continued survival as much to luck as logic. John F. Kennedy himself put the chance of nuclear war during the Cuban Missile Crisis at one in three-odds, Allison notes, that are twice as high as those in Russian Roulette. To share Waltz's faith in the pacifying effects of proliferation, says David Goldfischer of Denver University's Graduate School of International affairs, is to subscribe to a sort of ''nuclear theology.'' (Goldfischer is himself a proponent of what he calls Mutual Defense Emphasis-a proposed treaty regime in which nuclear arsenals would be sharply reduced and mutually acceptable missile defenses installed by opposing nuclear powers.) Waltz, Goldfischer charges, ''is utterly convinced that there's a rational core in every brain similar to his own, which will act somehow at the critical moment, and that no one will be able to reach a leadership position in any society who will make the potentially suicidal decision to launch when a massive retaliation is a certainty.'' And that doesn't begin to account for the possibility of an accidental launch or an attack by an Al Qaeda operative whose effective statelessness and hunger for martyrdom make him undeterrable. John J. Mearsheimer, a political scientist at the University of Chicago and another preeminent realist thinker, describes himself as closer to Waltz than to Allison on the issue. Mearsheimer agrees with Waltz, for example, that nuclear states, no matter how ''rogue,'' are unlikely to give their weapons to terrorists. Whatever its sympathies, Mearsheimer argues, ''Iran is highly unlikely to give nuclear weapons to terrorists, in large part because they would be putting weapons into the hands of people who they ultimately did not control, and there's a reasonably good chance that they would get Iran incinerated'' if the weapon was traced back to the regime in Tehran. ''Any country that gave [nuclear weapons] to terrorists who would use them against the US,'' Mearsheimer adds, ''would disappear from the face of the earth.'' . . . The problem of ''loose nukes''-in particular, Russia's inability in the years since the Cold War to keep track of all its nuclear materials-shows that even a country's strong interest in maintaining control of its nuclear weapons is no guarantee that some won't fall into the wrong hands, raising the threat of nuclear terrorism. Nevertheless, thinkers like Waltz and Mearsheimer, with their dogged focus on the calculus of national advantage and interest, raise a question that tends to get lost in much of the news coverage of proliferation: Do nuclear states like the United States oppose proliferation simply out of concern for their citizens' safety, or is there something more strategic at work? In Waltz's formulation, nations acquire nuclear weapons not to menace their neighbors but to protect themselves. And to the governments of North Korea and Iran, the primary threat is the United States. ''If you were making decisions for North Korea or Iran,'' Waltz asks, ''wouldn't you be deadly determined to get nuclear weapons, given American capability and American policy?''

7. Utgoff is terrible a. no warrantsb. oldc. doesn’t actually indicate a chance of extinction

8. No link – Fiat is a magic wand that eliminates the political process9. Disad is an intrinsic policy option – permutation solves

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1. Some form of healthcare reform is inevitable by the end of the year – Obama is banking his entire agenda on successful passage and is expending all the political clout he has to push it through –– that’s Woodhead.

2. Investor confidence low – comprehensive study provesJeff Benjamin, Investment News, 7/21/2009 (http://www.investmentnews.com/apps/pbcs.dll/article?AID=/20090721/REG/907219990)

Hedge fund managers and corporate boards received low marks with regard to ethical behavior in a recent survey of financial-industry professionals. The CFA Institute yesterday released the Financial Market Integrity Index illustrating “soured sentiment and shaken faith” among financial professionals regarding the ability of current U.S. investor protections to ensure an orderly functioning of the equity markets. In the ethical-behavior category, the perception of hedge fund managers was lowest overall, with pension fund managers earning the top-rated spot. More than 2,000 investment professionals participated in the research by taking the survey either online or via telephone interview in February and March. According to the report that accompanied the survey findings, respondents generally consider corporate boards and corporate executives to be most responsible for the current financial crisis. The Financial Market Integrity Index is designed to gauge chartered financial analysts’ perceptions of the state of ethics and integrity in different markets around the world. Based on their perception of market ethics and integrity alone, only 49% (versus 68% a year ago) of U.S.-based respondents were likely to recommend investing in U.S. markets. Those outside the United States also appear to have lost faith in the U.S. market systems, according to the finding.

3. Failure to rectify ballooning state Medicaid deficits makes economic decline inevitable. We control the internal link to the impact – only federal action to stem states’ negative procyclical actions ends the recession – that’s Mattoon and Lav.

4. Deficits growing now – no fix comingTHE DAILY INDEPENDENT 5 – 25 - 09[President’s policies don’t match his words, The Daily Independent, Ashland, http://bgdailynews.com/articles/2009/05/25/opinion/our_opinion/opinion2.txt]

When it comes to reducing the federal deficit, President Barack Obama’s actions fall far, far short of matching his words. The new president recently told his Cabinet: “We can no longer afford to spend as if deficits do not matter. ... We can no longer afford to leave the hard choices for the next budget, the next administration, or the next generation.” Those words come after eight years of irresponsible spending during the administration of President George W. Bush, which believed deficits really didn’t matter. For those who us who believe that bringing spending in line with revenue does matter, Obama’s words were most welcome. However, Obama’s actions tell a different story. New White House forecasts show a deficit of $1.8 trillion this year, almost four times the previous record set by President Bush, and $1.3 trillion next. The federal government now borrows a whopping 46 cents of every $1 it spends. The White House forecasts show that, even assuming a fully recovered economy, the deficits will not dip below $500 billion a year for the next decade. In short, despite all of his assuring words, President Obama plans on passing the problem of the deficit to the next president. The White House contends big spending - the Wall Street bailout, the stimulus package - is a necessary but temporary evil to jump-start the country out of recession. Maybe so, but there’s nothing in his budgets or his economic policy speeches to indicate a serious assault on the deficit once the current crisis passes. What additional revenues there are in his budget are earmarked to offset the cost of his health-care reforms, not deficit reduction. Nevertheless, expect President Obama to boast in future years about cutting the deficit. If so, that would be a tactic lifted from his predecessor. ... To be fair, President Obama recently sent to Congress a proposal to either eliminate or reduce spending for 121 programs for a savings of $17 billion. If that sounds like a lot, it represents 0.5 percent of next year’s projected $3.4 trillion in federal spending. And his proposal immediately ran into a storm of opposition on Capitol Hill, mostly from his own Democrats trying to protect their pet projects. Maybe deficits really do matter to Obama, but his proposals sure don’t indicate that.

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5. Turn - health care taxes would destroy small businesses – key to the economy.Lambro 2/27Donald Lambro is the chief political correspondent of The Washington Times, the author of five books on the government and the economy, and a nationally syndicated columnist He won the 1995 Warren Brookes Award for Excellence in Journalism “LAMBRO: Obama's budget to raise small-business taxes” February 27, 2009 (http://www.washingtontimes.com/news/2009/feb/27/obamas-budget-to-raise-small-business-taxes/)[LO//AS]

Business advocates charged that multiple tax increases on Americans earning more than $250,000 a year would whack small businesses who pay the individual income tax, too, and produce as much as 60 percent of all jobs . "You don't build a house by blowing up its foundations. Small businesses and the entrepreneurs who lead them have been the primary drivers of job growth over the past decade. This plan would punish them with higher taxes, resulting in less government revenue, less economic growth, and fewer jobs - not more," said Bruce Josten, chief lobbyist at the U.S. Chamber of Commerce. On Capitol Hill, House Minority Leader John A. Boehner of Ohio called the budget plan a "job killer," saying that "small businesses, family farms, middle-class families, retirees, charities, everyone with a 401(k), and anyone who flips on a light switch is going to pay higher taxes under this plan." Mr. Obama ran for president saying he will raise taxes on wealthy Americans by boosting the present 35 percent top income tax rate to the nearly 40 percent rate under President Clinton in the 1990s. Then, as the recession deepened last year, he changed his mind, saying that this was not the time to raise taxes on higher income people because it would further weaken the economy. But Mr. Obama needs increased revenue to launch his national health care plan - which will cost an estimated $1 trillion over 10 years - and his budget calls for letting President George W. Bush's two top tax rates expire at the end of 2010. The White House expects the economy to be in a recovery at that time, but many economists, including members of the Federal Reserve Board, say it could still be in a recession or in a weakened condition well into 2011. Business advocates charged that multiple tax increases on Americans earning more than $250,000 a year would whack small businesses who pay the individual income tax, too, and produce as much as 60 percent of all jobs . "You don't build a house by blowing up its foundations. Small businesses and the entrepreneurs who lead them have been the primary drivers of job growth over the past decade. This plan would punish them with higher taxes, resulting in less government revenue, less economic growth, and fewer jobs - not more," said Bruce Josten, chief lobbyist at the U.S.

6. Turn – plan slashes healthcare costs by $300 billionHimmelstein, dept Medicine Harvard, and Woolhandler, MD + MPH, ‘07(David U. Himmelstein, MD; The Department of Medicine at Cambridge Health Alliance/Harvard Medical School, and Steffie Woolhandler, MD, Physicians for a National Health Program of Chicago, 11/07, “Our Health Care System at a Crossroads: Single Payer or Market Reform?” www.pnhp.org/news/2008/may/our_health_care_syst.php) [LO//JW]

 In contrast to CDH, a properly structured NHI program could expand coverage without increasing costs by reducing the huge health administrative apparatus that now consumes 31% of total health spending. Health care’s enormous bureaucratic burden is a peculiarly American phenomenon. No nation with NHI spends even half as much administering care nor tolerates the bureaucratic intrusions in clinical care that have become routine in the United States. Indeed, administrative overhead in Canada’s health system, which resembles that of the United States in its emphasis on private, fee-for-service–based practice, is about half the US level. Our biggest HMOs keep 20%—even 25%—of premiums for their overhead and profit; Canada’s NHI has 1% overhead and even US Medicare takes less than 4%. And HMOs inflict mountains of paperwork on doctors and hospitals. The average US hospital spends one-quarter of its budget on billing and administration, nearly twice the average in Canada. American physicians spend nearly 8 hours per week on paperwork and employ 1.66 clerical workers per doctor, far more than in Canada. Reducing our bureaucratic apparatus to Canadian levels would save about 15% of current health spending, $300 billion annually, enough to fully cover the uninsured and to upgrade coverage for those now underinsured. Proponents of NHI, disinterested civil servants and , and even skeptics all agree on this point. Unfortunately, neither piecemeal tinkering nor wholesale computerization can achieve significant bureaucratic savings. The key to administrative simplicity in Canada and other nations is single-source payment. Canadian hospitals, which are mostly private, nonprofit institutions, are paid a global annual budget to cover all costs, much as a fire department is funded in the United States, obviating the need for administratively complex per-patient billing. Canadian physicians, most of whom are in private practice, bill by checking a box on a simple insurance form. Fee schedules are

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negotiated annually between provincial medical associations and governments. All patients have the same coverage.

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7. Plan solves impact - federal economic action ineffective without rectifying state deficit problems.Krugman, prof of economics and international affairs @ Princeton. 7/22/09.Paul. “Fifty Herbert Hoovers.” New York Times. http://www.nytimes.com/2008/12/29/opinion/29krugman.html?_r=1&ref=opinion&pagewanted=print [Mardjuki]

No modern American president would repeat the fiscal mistake of 1932, in which the federal government tried to balance its budget in the face of a severe recession. The Obama administration will put deficit concerns on hold while it fights the economic crisis. But even as Washington tries to rescue the economy, the nation will be reeling from the actions of 50 Herbert Hoovers — state governors who are slashing spending in a time of recession, often at the expense both of their most vulnerable constituents and of the nation’s economic future. These state-level cutbacks range from small acts of cruelty to giant acts of panic — from cuts in South Carolina’s juvenile justice program, which will force young offenders out of group homes and into prison, to the decision by a committee that manages California state spending to halt all construction outlays for six months. Now, state governors aren’t stupid (not all of them, anyway). They’re cutting back because they have to — because they’re caught in a fiscal trap. But let’s step back for a moment and contemplate just how crazy it is, from a national point of view, to be cutting public services and public investment right now. Think about it: is America — not state governments, but the nation as a whole — less able to afford help to troubled teens, medical care for families, or repairs to decaying roads and bridges than it was one or two years ago? Of course not. Our capacity hasn’t been diminished; our workers haven’t lost their skills; our technological know-how is intact. Why can’t we keep doing good things? It’s true that the economy is currently shrinking. But that’s the result of a slump in private spending. It makes no sense to add to the problem by cutting public spending, too. In fact, the true cost of government programs, especially public investment, is much lower now than in more prosperous times. When the economy is booming, public investment competes with the private sector for scarce resources — for skilled construction workers, for capital. But right now many of the workers employed on infrastructure projects would otherwise be unemployed, and the money borrowed to pay for these projects would otherwise sit idle. And shredding the social safety net at a moment when many more Americans need help isn’t just cruel. It adds to the sense of insecurity that is one important factor driving the economy down . So why are we doing this to ourselves? The answer, of course, is that state and local government revenues are plunging along with the economy — and unlike the federal government, lower-level governments can’t borrow their way through the crisis. Partly that’s because these governments, unlike the feds, are subject to balanced-budget rules. But even if they weren’t, running temporary deficits would be difficult. Investors, driven by fear, are refusing to buy anything except federal debt, and those states that can borrow at all are being forced to pay punitive interest rates.

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1. Case internals outweigh the disad’sa. Technological dominance means that each one of our soldiers can do more damage than one of

the enemy’s, so we need less soldiersb. Economic power is perceived more than military readiness - if every single state’s economy

collapsed, then other countries would perceive that the US is no longer a threatc. Economic decline means that the US withdraws, eliminating the use of a military

2. Budget Cuts mean recruiting will decreaseWatertown Daily Times ’09 (Watertown Daily Times 5-12-09 http://www.watertowndailytimes.com/article/20090512/OPINION01/305129958)

The Defense Department has benefited from the recession which has boosted enlistments and helped meet the nation's manpower needs. The armed services have met or exceeded their recruitment goals in the past few months, so much so that they can again be more selective in choosing their recruits. In order to meets its goals, the Army has been issuing waivers to those with criminal records or health problems who would have been unacceptable before. That is no longer necessary. The recession has made the armed services a more appealing alternative to job seekers at a time that the Pentagon is also increasing manpower levels to meet security needs. As a result, the Pentagon plans to cut its $7.7 billion budget for recruiting and retention by almost $800 million. That comes as good news for the Pentagon and nation, but it also calls for caution to avoid falling behind on future manpower needs.

3. Impoverished already have healthcare from Medicaid so they wouldn’t join the military – their link ev assumes welfare-style programs which the plan doesn’t do

4. Stimulus spent over 300 billion dollars on expanding social servicesAP Associated Press, June 4, 2009, http://www.msnbc.msn.com/id/31110642//Remember the "shovel-ready" projects lined up for all that stimulus money? It turns out social spending, more than construction, is hitting pay dirt in the huge federal effort to turn the economy around.The public face of the stimulus package has been the worker in a hard hat, getting back on the job to rebuild the nation's infrastructure.Earlier this spring, for example, California Gov. Arnold Schwarzenegger appeared before the cameras at a job site along a freeway east of San Francisco. He declared that the stimulus-financed project would provide paychecks for 235 construction workers who otherwise would have to "stand in the unemployment line."The reality of how the vast majority of the stimulus money will be spent is quite different, and that raises questions about how much help the Recovery Act backed by President Barack Obama will be to the economy in the long run.Most of the roughly $300 billion coming directly to the states is being funneled through existing government programs for health care, education, unemployment benefits, food stamps and other social services."We all talked about 'shovel-ready' since September and assumed it was a whole lot of paving and building when, in fact, that's not the case," said Chris Whatley, the Washington director of the Council of State Governments, a trade group for state governments. He estimates states will get three times more money for education than for transportation.Government programs benefitTwo-thirds of recovery money that flows directly to states will go toward health care.By comparison, about 15 percent of the money is for transportation, including airports, highways and rail projects, according to Federal Funds Information for States, a service of the National Governors Association and the National Conference of State Legislatures.Overall, two-thirds of the stimulus program will go toward tax cuts, relief for state budgets and direct payments to the unemployed and others hurt by the recession, part of the administration's desire to provide immediate fiscal

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relief. Much smaller pieces of the pie will be allocated for weatherization, affordable housing and other projects designed to create jobs.

2AC Military DA (2/2)

John Husing, a Southern California economist, said keeping teachers and police officers employed should help prevent the recession from getting worse. But he said the stimulus package would have improved communities' ability to grow over the long haul if it had dedicated more money to public works.While billions of dollars eventually will flow to infrastructure projects, Democrats who crafted the package say they directed most of it to existing government programs such as Medicaid and education to prevent state economies from slipping even more. One goal was to help fill state budget gaps, keeping teachers and others employed while strengthening the social safety net.

5. Obama’s health care reform bill will pass before the end of the year – impact is inevitable – that’s Woodhead 9.

6. Troops unnecessary- different approach keyWoodward, Washington Post staff writer, July/1/09(Bob Woodward, Washington Post Staff Writer, July 1, 2009, The Washington Post, http://www.washingtonpost.com/wp dyn/content/article/2009/06/30/AR2009063002811.html?sid=ST2009063002822)The day before in Kabul, Jones delivered the same message to Gen. Stanley A. McChrystal, the new overall commander in Afghanistan. McChrystal has undertaken a 60-day review designed to address all the issues in the war. In addition, Jones has told Secretary of Defense Robert M. Gates and Adm. Michael Mullen, the chairman of the Joint Chiefs of Staff, that they should focus on implementing the current strategy, completing the review and getting more Afghan forces involved in the fight before requesting additional U.S. troops for Afghanistan

7. Soft Power Turna. Increase in U.S. troop’s results in imperialism- hurts soft power The Michigan Daily, 7/23/09(The Michigan Daily, Ed Mcphee, July 23, 2009, http://www.michigandaily.com/content/2009-07-20/ed-mcphee-attack-economy)With U.S. troops stationed in more than 150 countries according to statistics for the Department of Defense on the Census Bureau's 2009 statistical abstract, U.S. armed forces sometimes seem like the United Nation’s police force. The wide spread of troops reeks of imperialism. Only a country with imperial intentions would spread their troops that widely. Examples range from the expansion of the USSR to Alexander the Great’s Macedonian conquest. The U.S.’s imperialism has dramatically damaged the way the rest of the world looks at our nation, and it continually damages the nation’s economy.

b. Soft power is key to hegemony.Walt, Academic Dean and at Harvard’s Kennedy School of Government, 05(Stephen M. Walt, Academic Dean and Robert and Renee Belfer Prof of International Affairs at Harvard’s Kennedy School of Government), Sep/Oct 2005, Foreign Affairs, Vol. 84, Issue 5, Ebsco)Attacking U.S. legitimacy is also a favorite way to erode Washington's international clout. As the world's dominant power, the United States has much to gain from the perception that its power is legitimate. When people around the world believe that U.S. primacy advances broader global interests, Washington finds it easier to rally international support for its policies, leaving its opposition isolated and ineffective. Accordingly, the United States' opponents are currently seeking to convince others that Washington is selfish, hypocritical, immoral, and unsuited for world leadership, and that its dominance harms them. This assault on U.S. legitimacy does not directly challenge U.S. power, but it encourages other people to resent and resist U.S. supremacy.

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1. Normal means is that the plan doesn’t affect illegal immigrants – mitigates the link Landers, writer for the Dallas Morning News, 5/22Jim Landers, writer for the Dallas Morning News “Senator says health insurance plan won't cover illegal immigrants” http://www.dallasnews.com/sharedcontent/dws/dn/latestnews/stories/0522DNBUShealthcare.25377b8.htmlHealth care reforms aiming for universal coverage won't provide insurance for illegal immigrants and may not address the cost to state and local governments for providing medical care to this large group of the uninsured, the chairman of the Senate Finance Committee said Thursday. "We're not going to cover undocumented aliens, undocumented workers," Sen. Max Baucus, D-Mont., said at a meeting with reporters. "That's too politically explosive." Universal health insurance is a key aim of health reform proposals backed by President Barack Obama and key Democrats in Congress, and bills being assembled in House and Senate committees are aiming to reach that goal through a mix of incentives and mandates.

2. Recession means businesses are more likely to hire illegal immigranta. Cheaper labor is wanted during bad economic timesb. minimum wage just rose, meaning businesses want cheaper labor

3. Innovation turna. Immigration key to innovationHunt et al. 08Jennifer Hunt, Professor of Economics at McGill University, “HOW MUCH DOES IMMIGRATION BOOST INNOVATION?”, a study for the NATIONAL BUREAU OF ECONOMIC RESEARCH http://www.nber.org/papers/w14312.pdf page 24We find that a college graduate immigrant contributes at least twice as much to patenting as his or her native counterpart. The difference is fully explained by the greater share of immigrants with science and engineering education, implying immigrants are not innately more able than natives. Indeed, immigrants are less likely to have patented recently than observably similar native scientists and engineers. Despite this, the fact that immigrants increase patenting per capita without reducing native patenting shows that their presence in the United States provides a previously undocumented benefit to natives, assuming the immigrants would have been less innovative or less able to commercialize their innovation elsewhere or that U.S. natives benefit more from innovation and commercialization in the United States than abroad.

b. And technological competitiveness is key to hegemonySegal 04 Writer for Foreign Affairs "Is America Losing its Edge?" http://www.foreignaffairs.org/20041101facomment83601/adam-segal/is-america-losing-its-edge.htmlThe United States' global primacy depends in large part on its ability to develop new technologies and industries faster than anyone else. For the last five decades, U.S. scientific innovation and technological entrepreneurship have ensured the country's economic prosperity and military power. It was Americans who invented and commercialized the semiconductor, the personal computer, and the Internet; other countries merely followed the U.S. lead. Today, however, this technological edge-so long taken for granted-may be slipping, and the most serious challenge is coming from Asia. Through competitive tax policies, increased investment in research and development (R&D), and preferential policies for science and technology (S&T) personnel, Asian governments are improving the quality of their science and ensuring the exploitation of future innovations. The percentage of patents issued to and science journal articles published by scientists in China, Singapore, South Korea, and Taiwan is rising. Indian companies are quickly becoming the second-largest producers of application services in the world, developing, supplying, and managing database and other types of software for clients around the world. South Korea has rapidly eaten away at the U.S. advantage in the manufacture of computer chips and telecommunications software. And even China has made impressive gains in advanced technologies such as lasers, biotechnology, and advanced materials used in semiconductors, aerospace, and many other types of manufacturing. Although the United States' technical dominance remains solid, the globalization of research and development is exerting considerable pressures on the American system. Indeed, as the United States is

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learning,

2AC Immigration DA (2/4)

globalization cuts both ways: it is both a potent catalyst of U.S. technological innovation and a significant threat to it. The United States will never be able to prevent rivals from developing new technologies; it can remain dominant only by continuing to innovate faster than everyone else. But this won't be easy; to keep its privileged position in the world, the United States must get better at fostering technological entrepreneurship at home.

4. Immigration will increase(Carl Haub, senior demographer at the Population Reference Bureau, 02 08, “U.S. Population Could Reach 438 Million by 2050, and Immigration Is Key,” http://www.prb.org/Articles/2008/pewprojections.aspx <http://www.prb.org/Articles/2008/pewprojections.aspx> )

It is no surprise that immigrants and their descendants will play a large role in future U.S. population growth, as they do now and have for much of the country's history. But the projections detailed in the new report, authored by demographer Jeffrey S. Passel and writer D'Vera Cohn, differ from previous projections from the U.S. Census Bureau by assuming that the rate of immigration will hold steady—sending the net number of immigrants from 1.4 million per year in 2005 to 2.1 million per year by 2050 as the population total rises. This assumed increase in immigrants is, as the Pew report puts it, "in line with, but somewhat slower than, the growth trend of the last several decades."The Pew projections also offer a unique analysis of immigrants' role by taking into account the different birth rates of first-, second-, and third-generation immigrants. The authors estimate that immigrants arriving after 2005, and their children and grandchildren, will account for 82 percent of the population growth between 2005 and 2050.

5. Highest immigration rate in history of America nowScott, staff writer, 2009(Jenny, 2-10-09, “Immigration High” http://www.nytimes.com/2002/02/10/weekinreview/february-3-9-national-immigration-high.html?scp=4&sq=immigration%20high&st=cse) [Charlie Stephens]

The number of foreign-born residents and children of immigrants in the U.S. has climbed to its highest level in history, the Census Bureau announced. More than a quarter are from Mexico; that is the largest share held by any country since 1890, when Germany accounted for 30 percent. On average, they are more urban, less educated and less affluent than other Americans, but as likely to be in the labor force. They make up 20 percent of the population -- less than the 1910 peak of 35 percent.

6. Immigration is good for the economy – they contribute at least $10 billion each yearMelissa Marietta 06. [“Undocumented immigrants should receive social services”]http://findarticles.com/p/articles/mi_m0IMR/is_1-2_81/ai_n16599310/pg_4/?tag=content;col1

The National Research Council has found that "immigration benefits the U.S. economy overall, and has little negative effect on the income and job opportunities of most native-born Americans." (17) It asserts that "immigrants add as much as $ 10 billion to the economy each year and they will pay more in taxes than they use in government services over their lifetimes." (18) Jeffery Passel, the author of several studies on immigration, adds "that all immigrants arriving after 1970 pay a total of $70 billion in taxes to all levels of government, thereby generating $25-$30 billion more than they use in public services." (19)

7. Recession doesn’t matter - Mexico was also hit, meaning there is a minimal risk that they are comparatively better off than us

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8. Mexican Stability turna. Immigration is key to Mexican stabilityWeintraub 07Sidney Weintraub, holder of the William E. Simon Chair in Political Economy and professor emeritus at the Lyndon B. Johnson School of Public Affairs of the University of Texas at Austin, “The Immigration Debate and U.S.-Mexican Relations” http://docs.google.com/gview?a=v&q=cache%3ASQ6z89XAYQUJ%3Acsis.org%2Ffiles%2Fmedia%2Fcsis%2Fpubs%2F070625_weintraub_commentary.pdf+immigration+us-mexican+relations&hl=en&gl=us&pli=1This polarized depiction has been changing slowly, especially since NAFTA came into effect in 1994. NAFTA itself was a significant departure in trade policy in that Mexico until then tried to limit trade and investment relations with the United States only to embrace the salience of the United States as a market and as a source of foreign investment. In the years before NAFTA, Mexico had a conscious policy of not having any policy toward U.S. immigration practices, but then lobbied hard for regularization of undocumented Mexican immigrants and a large temporary worker program – Mexico sought what former foreign minister Jorge Castañeda called “the whole enchilada.” Mexican President Felipe Calderón publicly criticized the U.S. intention to build fences along the border during a joint press conference with President Bush when the latter was on an official visit in Yucatán. If the United States is effective in cutting off undocumented immigration from Mexico, and if there is not a substantial temporary worker program to offset Mexico’s safety valve, this may introduce a severe problem in Mexico to create enough good jobs at home to reduce the emigration push force. Destabilization in Mexico, which could ensue, is mainly a Mexican problem, but one that will have repercussions next door in the United States. The United States would then have to devise policies to deal with Mexican instability.

b. Mexican stability key to US security and prosperityRoberts and Walser 2/12James Roberts, Research Fellow For Economic Freedom and Growth at the Center for International Trade and Economics (CITE), and Ray Walser Senior Policy Analyst for Latin America at the Douglas and Sarah Allison Center for Foreign Policy Studies “Growing Instability in Mexico Threatens U.S. Economy and Border Security” http://www.heritage.org/research/latinamerica/wm2290.cfm

Mexico's ongoing political stability and economic health are critical to the prosperity and national security of the United States. The Obama Administration must make confronting the many challenges facing our southern neighbor both a foreign and a domestic policy priority. In order to realize this vital American interest, the current Administration should do the following:

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9. Healthcare is not a magnet for immigrationKing, writer for Center for American Progress, 07

(Meredith L. King, Writer for Center for American Progress; a program dedicated to improving American lives through thoughts and actions 6/7/07 http://www.americanprogress.org/issues/2007/06/pdf/immigrant_health_report.pdf

Job opportunities across the country are the “magnet” that draws immigrants to the country; not federal incentives such as health care coverage and services. Immigrants are most likely to be employed in indus-tries that do not offer health insurance coverage, such as agriculture, construction, food processing, restau- rants, and hotel services.31 Immigrants are nearly four times more likely to work in the agricultural industry and two times more likely to work in the construction industry.32 Uninsured rates in these industries are over 30 percent for all workers compared to 19 percent for workers across all industries.33 Work opportunities through guest-worker programs also drive immigration. Yet the guest-worker pro-grams for temporary, unskilled labor (the H-2A pro- gram for agriculture workers and the H-2B program for non-agriculture workers) provide limited, if any, health care benefits to the documented immigrants in the programs.34 Immigrants in the H-2A program do have limited legal protections, including employer compensation benefits for medical costs and payment for lost time due to temporary or permanent work injury. But ag-ricultural employers in this program are not required to provide health insurance or other needed servic-es.35 And existing protections are rarely enforced. Immigrants in the H-2B programs do not even have those limited benefits. Their employers are obligated to offer full-time work and pay the prevailing wage rate, but there is no regulation requiring any of the benefits afforded H-2A workers.36 And while it may seem that H-2A workers have limited access to the health care system on paper, in practice they often find that they do not. These laborers often toil in two of the most dangerous industries, agriculture and forestry. Fatality rates in these two industries are nearly 10 times the national average.37 Yet both H-2A and H-2B workers often do not have health insurance to cover appropriate care. Even worse, if an injury or illness is severe, immigrant workers in these two programs lose their jobs and therefore their legal status to stay in the United States.38 Immigrant day workers experience a similar fate. A 2003–2004 national survey of predominantly undocumented day workers found a high level of occupational injuries. One-fifth of the day laborers had suffered a work-related injury, but less than half received medical care for their injuries.39 Purchasing health insurance through the private market is an unlikely option for mmigrants as well . The unskilled work of many immigrants is often low-wage;40 day workers were unlikely to have annual earnings that exceeded $15,000 and full-time immi- grant workers average $23,000 in annual income in 2003.41 Yet the average annual premiums cost paid by a worker for individual employer coverage was $508 and for family coverage was $2412 that same year.42

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1. Perm do both – perm accesses double coverage of dual single-payer healthcare systems.

2. 50 State fiat bad – a. Not researchable. The fifty states have never uniformly passed a single policy. We can’t

research specific solvency answers to a mechanism that isn’t predictable.

b. Kills decisionmaker education – no cost benefit analysis is involved because senators don’t consider the possibility of other actors enacting their policy – it’s not real world.

c. They can have their CP if they have solvency evidence for the states uniformly doing every single plank of the CP – CP’s grounded in the literature are the only ones we can predict and research.

3. States can’t solve – increased taxes exacerbate the recession.BPP. 7/23/09.“New Fiscal Year Brings Continued Trouble for States Due to Economic Downturn.” Policy Points, Center on Budget and Policy Priorities. http://www.cbpp.org/cms/index.cfm?fa=view&id=1283 [Mardjuki]

The state revenue situation is rapidly worsening. • To keep pace with the cost of services, state revenues must grow. But overall revenues last year were essentially flat and have weakened dramatically this year. The Rockefeller Institute of Government reports state tax collections fell 12.6 percent in the first quarter of 2009 compared with last year. • Sales taxes are the largest source of state tax revenue, and they are declining due to the fall in both personal consumption and business purchases. Income taxes and other taxes are also falling as wages and investment income decline. According to the Rockefeller Institute of Government, income tax collections during the first four months of this year fell by 26 percent compared to the same period last year. Continued job losses will depress revenues further. States face other problems from the weakening economy. • Employers are reducing jobs and cutting back on employer-provided health coverage. As a result, more families are turning to programs like Medicaid, which provides health coverage to low- and moderate income families and is jointly funded by Washington and the states.

4. Entire econ advantage is a complete solvency takeout to this counterplan – state legislatures are already struggling to pay for current Medicaid programs – counterplan plunges states further into the red and exacerbates the recession – that’s Sack and Mattoon.

5. Federalist healthcare politically controversial – lacks single-payer’s prior history of supportBorosage, prof of law @ American University, Hickey, vice president @ Economic Policy Institute. 2001.Robert and Roger. The Next Agenda: Blueprint for a New Progressive Movement. Pg 112. [Mardjuki]

The federalist option thus solves the puzzle of how to translate a majority favoring health reform into legislation when that majority cannot agree on the precise shape of reform. Substantively, it recognizes the variation in state health care systems and reform preferences. Politically, it taps into the rhetoric of devolution, states' rights, and choice. lt also puts opponents of reform on the defensive, shifting the focus of debate from the details of a particular plan to the fundamental question of whether legislators support universal coverage. However, the federalist strategy is not problem-free. The first and largest barrier it has to surrnount is that it represents a new alternative in the American health re- form debate—and one that lacks the familiarity of, for example, single- payer insurance. As both Clinton and Bradley learned, it is politically difficult to build legislative and public constituencies around ideas that have no prior history of support from legislators or consumer groups active in health care policy.

6. Counterplan doesn’t end states’ procyclic economic action – only a federal system solves – that’s Lav and McNichol.

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7. States fail – inequitable, inefficient, and vulnerable to state politics deadlock.Borosage, prof of law @ American University, Hickey, vice president @ Economic Policy Institute. 2001.Robert and Roger. The Next Agenda: Blueprint for a New Progressive Movement. Pg 112. [Mardjuki]

The objection most likely to be raised is that the state-by-state variation permitted by a federalist health system would be inequitable. Such a system would be unfair, in critics’ view, because citizens’ access to medical care services would be a function the health system chosen by the state in which they reside. Another objection might be that the federalist strategy would circumvent natural gridlock only to allow reform to fall victim to political deadlock at the state level. Some legislatures might replicate congressional failure to enact reform; or some states might resist the imposition of a federal mandate for health reform that they do not welcome for ideological or financial reasons. In addition, even though the federalist plan mandates a state plan for cost control, in the absence of a national budget for health care the state’s control over medical care spending could be even less certain than under the single-payer model.

8. <INSERT STATE SPECIFIC ECON DA/STATE POLITICS DA>

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States can’t solve – can’t cover uninsured, coverage and spending variation.Holahan, Director of Health Policy Research Center @ The Urban Institute. 2007.John. “State Variation in Medicaid Spending: Hard to Justify.” Health Affairs: Policy Journal of the Health Sphere. Volume 26 No. 6, September 18, Pgs 667-669. http://healthaff.highwire.org/cgi/content/full/26/6/w667 [Mardjuki]

Martin and colleagues’ paper does not address another major source of variation in Medicaid spending: that states cover very different shares of their low-income populations. Moreover, people with low incomes are a higher share of the population in some states than others. States face very different problems in covering their low-income populations because of the variation in employer-sponsored insurance. This insurance varies among states because of industry and firm size, composition, education, income, and a number of other factors.2 As a result, states are left with very different shares of the population without employer-sponsored insurance. States then vary greatly in the extent to which public programs cover those who remain without coverage. As a result, uninsurance rates differ greatly among states. 3 This is in part because states have very different problems to address. In the end, state spending is determined by federal matching rates that vary inversely with state per capita income and with states’ willingness to spend from their own resources. The latter depends a lot on per capita income—that is, states’ ability to pay—but it also depends on the general philosophy toward income transfers to lower-income populations. The evidence shows that although federal matching rates are inversely related to income with the intent of encouraging states to spend more—that is, the marginal cost of additional spending is lower for lower-income states—the fact is that most states don’t take advantage of the federal offer of higher matching funds.4 That is, higher-income states tend to spend far more per capita from their own resources, such that even with the lower federal matching contributions, the federal and state spending on Medicaid services is much higher in high-income states than in low-income states. The incentives in Medicaid to have low-income states spend more by having federal payments offset lower state per capita incomes have simply not been successful. Between the variation in spending per enrollee and the share of low-income populations that are covered, the variations in Medic-aid spending are quite extensive. Some variation is inevitable and exists in Medicare and private coverage as well. But whether the variation that we observe in Medicaid is acceptable is another matter. We have shown elsewhere that states with lower levels of spending have lower levels of access and worse health outcomes. 5 Thus, the spending variations have consequences that are felt at the national level. Although the nation has chosen to have a decentralized system to provide coverage to low-income Americans, a great deal of federal money supports these programs. For example, more than half of the cost of Medicaid and the State Children’s Health Insurance Program (SCHIP) is borne by the federal government. Medicaid programs spent $314.5 billion for health services in 2006.6 Of this, $179.0 billion was spent by the federal government and $135.5 billion by states

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Federal action key to increase coverage and eliminate state treatment variation. Holahan, Director of Health Policy Research Center @ The Urban Institute. 2007.John. “State Variation in Medicaid Spending: Hard to Justify.” Health Affairs: Policy Journal of the Health Sphere. Volume 26 No. 6, September 18, Pgs 667-669. http://healthaff.highwire.org/cgi/content/full/26/6/w667 [Mardjuki]

States must provide a minimum amount of coverage and benefits , but they have considerable flexibility in extending coverage and structuring benefit packages, including the degree in which they cover long-term care services. But it can be argued that there is a national interest in how these programs work. If there is a strong national interest, then wide state variations are problematic. The large federal contribution to Medicaid and SCHIP and the fact that state matching rates vary inversely with state per capita income seems to recognize a national interest in extending coverage to low-income groups, regardless of where they live. Moreover, the recent interest in extending subsidies to low-income people through federal tax credits suggests that even those who oppose expanding government insurance programs in general accept the need to extend health insurance coverage to low-income Americans, regardless of where they live. There would actually be more national uniformity in the Bush administration tax proposals than exists in the current Medicaid and SCHIP structure. Ironically, the recent interest in state health reform is likely to make current inequities worse. Massachusetts has enacted a plan to achieve (close to) universal coverage. Other relatively progressive states including New York, Connecticut, Vermont, Pennsylvania, and Illinois have enacted or are seriously considering major proposals to extend coverage to all. In American politics today, it is likely that only these more progressive states can achieve the political consensus necessary to substantially extend coverage. Other states will be left with the current mix of programs. Coverage of individuals and spending on health services will be subject to state officials’ willingness to pay, regardless of the generosity of federal matching payments available to them. A national solution will be needed to eliminate the extensive variations that the current system has brought . But such a solution would have huge costs to the federal government. Moreover, political agreement on an approach to extending coverage to all will be difficult to achieve. The result of a stalemate will be that low-income people will continue to be treated very differently depending on where they live. This not only will have consequences for the states in which they reside, but because poor access to health care will affect health outcomes, it will have implications for the nation as well.

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A2: States CP

States ineffective – can’t fund, unanticipated costs, stimulus insufficient.Klein, senior editor, economic and domestic policy expert. 6/19/09.Ezra. “Guest Graph: The Future of Medicaid.” Washington Post. http://voices.washingtonpost.com/ezra-klein/2009/06/guest_graph_the_future_of_medi.html [JM]

Figure 2 is identical to Figure 1—except that it includes federal expenditures on the same graph. As you can see, federal expenditures have increased much faster, in both relative and absolute terms. Projections of future expenditures show the same pattern. Looking at these figures, you might reasonably ask: Why are states complaining? The answer is: They lack the fiscal capacity to bear the load. They face legal and institutional constraints on deficit financing and new taxes. They bear the consequences of their severe, bipartisan mismanagement of public employee health and retiree benefits. States also bear readily-overlooked systemic risks. Suppose, for example, that medical improvements gradually raise average lifespan of Alzheimer’s patients in long-term care. Or suppose that the firms which offer private long-term care policies run into trouble. It’s all too plausible to devise scenarios in which state Medicaid programs end up bearing large unanticipated costs. One way or another, the federal government must carry an increasing share of the Medicaid burden. Properly designed, health reform can also help by providing new forms of public or private coverage for low-income Americans who might otherwise require Medicaid. The impact of competing proposals for state finances has received less attention than it should. The recent stimulus package suggests another useful path. Until December 31, 2010, the federal government agreed to pay a higher matching rate to states that agreed to maintain Medicaid eligibility and benefits at roughly pre-recession levels. These subsidies should be enlarged and made permanent, in return for greater federal oversight over matters such as quality assurance and reimbursement. These fixes will help, but they will not be enough. As my colleague Colleen Grogan suggests, we should recognize and embrace the fact that Medicaid has become a central pillar of the American welfare state, not only for poor people, but for millions of others, too. The program has outgrown the financial and administrative capacity of state governments. Yet another challenge of health reform.

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Single Payer 2.0 LO 170

A2: States CP

Empirically, the states have been unable to solve Klein 07Ezra Klein, blogger for the Washington Post. He was formerly an associate editor for The American Prospect political magazine “Bridging the Gaps” http://www.prospect.org/csnc/blogs/ezraklein_archive?month=10&year=2007&base_name=bridging_the_gapsI’m here, I think, to be the Grinch. We’ve got all these great universal bills passing at the state level, and I’m here to tell you that, well, they are pretty great, but they’re not going to work. It didn’t work in Washington State, when they tried it, and the insurers first jacked up the premiums, and then moved out of the state in order to kill the model. It didn’t work in Hawaii, which saw an economic downturn move more people onto their subsidies exactly as the state’s revenues dropped. It didn’t work in Tennessee, where the Democratic governor, Phil Bredesen, upon killing off Tenncare and leaving 300,000 people uninsured, told his state that, "I say to you with a clear heart that I've tried everything. There is no big lump of federal money that will make the problem go away." Similar plans failed in Oregon, in Massachusetts, and many other states. The plans fall for a few small reasons, and one big one. The big one is that states don’t have the fiscal stability to run universal health care. 49 of 50 states cant deficit spend. That means that when the state goes into recession and more people need subsidies and the revenues to give them don’t exist the state can’t borrow the money. So they dismantle the program. It’s happened time and time again -- in some states, like Oregon, more than once. Moreover, you don’t really want this being a state-run solution. As a stopgap, increasing coverage through state plans is worthwhile, but health care reform is more than access – it’s actual reform to bring down costs, which are, at the end of the day, the biggest problem in the system. And the states don’t have the regulatory authority, the money, or, save in a few cases, the size to do that. I simply don’t trust them to fundamentally reform the system.

Who should pay for health care? The simple answer is, all of us! The more critical question is how we pay. Medical professionals have made tremendous progress but at a cost that puts care out of reach for a third of our people. How we pay matters, because it affects cost in a big way, and cost will determine our achievement of quality universal coverage. We should not spend resources on anything that does not contribute value. Complexity does not contribute value and is expensive. Simplicity is frugal and effective. We should not pay through insurance. The insurance industry is complex and expensive. These useless middlemen cost us $400 billion every year. The best of them operate at an overhead of 15 percent, and their average overhead is 31 percent. Medicare — 65 and you’re in — operates at 3 percent. We have lived with HMOs for nearly two generations and they have failed to deliver affordable care. By their own admission, they are not sustainable without government subsidy. They contribute nothing of value. Indeed, they have been contemptuous of patients and the medical profession, and have been a source of frustration and expense. We should not pay through special programs for the poor. We pay a social worker to spend 3-1/2 hours per family to enroll them in Medicaid, and to make sure that no one gets services who is not properly poor. This process is expensive, demeaning, repetitive and perpetuates disparities. The universal programs currently discussed in Congress involve multiple tax exemptions and credits to pay for insurance premiums to multiple companies at multiple levels of poverty for multiple plans. This is money wasted by complexity that will not buy a single MRI or colonoscopy. Business and industry should not pay for health care. They have no moral or legal obligation, and they are in enough trouble already. Lifting their health care burden and throwing in workers’ compensation premiums, which would be redundant in a single-payer program, might assuage their resistance to a modest increase in corporate tax. It would certainly improve their competitiveness in the global economy and create a few more jobs at home. The simplest and therefore the most economical way to pay is single payer. Government already pays more than 60 percent of health care cost through Medicare, Medicaid, the Department of Veterans Affairs and insurance premiums for government employees at the federal, state, city, village, town and school district levels. Our so-called employer-based health care pays only 20 percent of the cost, and we, the people, empty our pockets for the last 20 percent in the form of deductibles and co-pays. Government already pays more than $3,600 per capita for health care, which is more than the single-payer countries pay per capita to cover their entire population. We might be able to achieve universal coverage without adding any more tax money to the system.

You’re A Jerk 170

Single Payer 2.0 LO 171

A2: Pincer CP/Medicaid Expansion CP

Pincer strategy can’t control costs.Borosage, prof of law @ American University, Hickey, vice president @ Economic Policy Institute. 2001.Robert and Roger. The Next Agenda: Blueprint for a New Progressive Movement. Pg 113-114. [Mardjuki]

Each of these advantages, however, has its downside: The pincer strategy simplifies administrative concerns by building on existing programs; however, one might reasonably question the effectiveness of Medicaid and CHIP as building blocks toward universal coverage. Enrollment in CHIP so far has been disappointing, and millions who are eligible for Medicaid have never applied for coverage. To some extent, this is due to the daunting bureaucratic and administrative hurdles that must be cleared in order to enroll. In addition, some state government have deliberately tried to keep enrollments down by limiting outreach campaigns. Remedies for the latter problem have been proposed, such as raising the level of federal matching funds allocated to states, or alternatively, imposing penalties on the laggards. But the key question is whether, even with the appropriate policy reforms, the addition of new populations to Medicaid would improve recipients’ medical care experience or merely exacerbate existing problems. In the case of Medicaid, these are well documented: administrative inefficiency, limitations of access, and perpetual underfunding. Lastly, the pincer strategy, unfortunately, would do little to control costs.

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